Bank of America Securities analyst Julien Dumoulin Smith reiterated a Buy rating on Vistra Energy (VST – Research Report) today and set a price target of $40.00.
Julien Dumoulin Smith assigned a Buy rating to Vistra Energy (VST) based on several key considerations. The upcoming 3Q23 earnings are expected to outperform consensus, driven by a favorable summer season in Texas. In the earnings call, it is anticipated that Vistra’s management will maintain their long-term capital allocation plan, focusing on stock buybacks and debt reduction. The potential for fossil divestiture is not readily apparent, and any additional renewable or nuclear acquisitions are projected to be approached with caution.
The share price of Vistra Energy is considered attractive from a risk-adjusted perspective, given that current levels suggest a roughly 25% leveraged free cash flow yield on 2025 projected earnings. However, there is some uncertainty surrounding Vistra’s pending acquisition of Energy Harbor’s three nuclear plants, which is still awaiting Federal Energy Regulatory Commission (FERC) approval. Although the transaction is ultimately expected to go through, the uncertainty regarding the timeline could impact projections negatively. Nevertheless, Vistra’s long-term targets appear to be intact, driven by favorable market fundamentals and strong fleet performance. This has prompted a raise in the price objective to $40 from $37.
According to TipRanks, Dumoulin Smith is a 4-star analyst with an average return of 1.7% and a 50.92% success rate. Dumoulin Smith covers the Utilities sector, focusing on stocks such as Hawaiian Electric, NextEra Energy, and Xcel Energy.
In another report released on October 17, Evercore ISI also maintained a Buy rating on the stock with a $35.00 price target.
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Vistra Energy (VST) Company Description:
Vistra Energy Corp. operates as an energy company, which engages in the provision of electricity and power generation. Its portfolio of businesses includes TXU Energy and Luminant. It operates through the following segments: Retail, ERCOT, PJM, NY/NE, MISO, Asset Closure, and Corporate and Other. The Retail segment sells electricity and related services to residential, commercial and industrial customers. The ERCOT, PJM, NY/NE, and MISO segments relate to electricity generation, wholesale energy sales and purchases, commodity risk management activities, and fuel production and logistics management. The Asset Closure segment involves in the decommissioning and reclamation of retired plants and mines. The Corporate and Other represents the remaining non-segment operations. The company was founded in 1882 and is headquartered in Irving, TX.
Read More on VST:
- Vistra price target raised to $32 from $31 at Guggenheim
- Vistra price target raised to $35 from $31 at Evercore ISI
- Vistra price target raised to $42 from $40 at BMO Capital
- Vistra Receives Nuclear Regulatory Commission Approval to Own & Operate Three Energy Harbor Nuclear Plants
- Vistra reports NRC approval to own, operate three Energy Harbor nuclear plants
