Bank of America Securities analyst Julien Dumoulin Smith reiterated a Buy rating on Vistra Energy (VST – Research Report) yesterday and set a price target of $52.00.
Julien Dumoulin Smith has given his Buy rating for Vistra Energy’s stock based on a number of encouraging financial indicators and strategic initiatives. The company’s stock is perceived to be trading with an appealing risk-adjusted free cash flow yield, which is expected to remain robust into the latter part of the decade, thanks to favorable market fundamentals. Additionally, Vistra Energy’s solid hedging strategy, which ensures 90% of expected generation is locked in through 2025, provides clear visibility for future cash flows. The company’s growth strategy, Vistra Vision, is also a focal point, with successful execution seen as key to the stock’s performance. Dumoulin Smith is closely monitoring the management’s progress, especially concerning nuclear generation, as this is considered a critical factor for the company’s success.
Looking forward, Dumoulin Smith forecasts a modest beat for Vistra Energy’s 4Q23 EBITDA and anticipates continued outperformance in FY24, driven by strong Generation economics and the growth of Vistra Vision. Despite a substantial increase in the stock’s value in 2023, the outlook remains positive, leading to a raised price objective to $52. This adjustment is largely due to a forward-looking sum-of-the-parts analysis extending to 2026. The valuation reflects a ~22.5% levered free cash flow yield for Vistra consolidated, which includes a ~12.5% yield specifically for Vistra Vision, supporting the continued recommendation to Buy.
According to TipRanks, Dumoulin Smith is a 4-star analyst with an average return of 3.2% and a 52.15% success rate. Dumoulin Smith covers the Utilities sector, focusing on stocks such as Duke Energy, NextEra Energy, and WEC Energy Group.
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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 begins cash tender offer
- Vistra Announces Cash Tender Offer for Remaining TRA Rights
- Vistra price target raised to $46 from $44 at Morgan Stanley
- TXU Energy enters multi-year partnership with University of Houston system
- Vistra Announces Pricing Terms of Cash Tender Offer for Senior Secured Notes
