Vistra Corp. (VST) Rose Due to Its Strong Position To Gain From The Buildout Of AI-Capable Data Centers

Fidelity Investments, an investment management company, released its “Fidelity Growth Strategies Fund” second quarter 2024 investor letter. A copy of the letter can be downloaded here. The strategy returned -2.39% in the quarter, modestly outpacing the benchmark Russell Midcap Growth Index’s -3.21% return. Security selection drove the outperformance of the strategy in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2024.

Fidelity Growth Strategies Fund highlighted stocks like Vistra Corp. (NYSE:VST), in the second quarter 2024 investor letter. Vistra Corp. (NYSE:VST) is an integrated retail electricity and power generation company. The one-month return of Vistra Corp. (NYSE:VST) was 56.51%, and its shares gained 270.44% of their value over the last 52 weeks. On September 30, 2024, Vistra Corp. (NYSE:VST) stock closed at $118.54 per share with a market capitalization of $40.726 billion.

Fidelity Growth Strategies Fund stated the following regarding 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.”

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Vistra Corp. (NYSE:VST) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 92 hedge fund portfolios held Vistra Corp. (NYSE:VST) at the end of the second quarter which was 79 in the previous quarter. While we acknowledge the potential of Vistra Corp. (NYSE:VST) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

In another article, we discussed Vistra Corp. (NYSE:VST) and shared the list of best stocks in each sector in 2024. Meridian Hedged Equity Fund benefitted from the surge of Vistra Corp. (NYSE:VST) in Q2 2024. In addition, please check out our hedge fund investor letters Q2 2024 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.