8 Hot Growth Stocks To Buy According to Hedge Funds

5. Vistra Corp (NYSE:VST)  

Year-To-Date Gain as of November 6: 213.92%

Number of Hedge Fund Holders: 92

Vistra Corp (NYSE:VST) is a Texas-based, vertically integrated energy company with a broad portfolio that includes electricity generation, wholesale energy sales, fuel production, and logistics. The company provides electricity and natural gas to residential, commercial, and industrial customers.

On October 17, JPMorgan initiated coverage of Vistra Corp (NYSE:VST) with an Overweight rating and a price target of $178. The firm emphasized the company’s strong positioning within Texas’s growing power demand landscape, noting potential gains from natural gas production growth and market volatility. JPMorgan’s analysis also highlighted a potential increase in baseload electricity demand, predicting a supply shortfall of around 40 gigawatts by 2030, mainly due to coal plant retirements and Texas Emissions Reduction Plan (TERP) incentives. This scenario could benefit Vistra Corp (NYSE:VST) significantly.

Looking ahead to 2025, Vistra Corp (NYSE:VST) raised its adjusted EBITDA midpoint range by $200 million, citing favorable market conditions and effective hedging strategies. The company, known for its shareholder-friendly approach, has returned about $5 billion to investors since late 2021 and plans to continue share buybacks of at least $2.25 billion through 2025.

Here’s what Fidelity Investments said about Vistra Corp. (NYSE:VST) in its Q2 2024 investor letter:

“An overweight stake in utility company Vistra Corp. (NYSE:VST) (+24%) was the top individual relative contributor. In Q1, the Texas-based independent power producer completed its acquisition of Ohio-based nuclear fleet operator Energy Harbor. The new Vistra, with its expanded geographic footprint, is in strong position to gain from the buildout of AI-capable data centers, which require enormous amounts of power to run. It is expected that local grids in the U.S. will need to invest heavily over the coming years to improve their power infrastructure and meet growing demand. In the nearer term, firms may choose to contract with independent power producers, like Vistra, rather than rely on the local provider.”