The cumulative annual increase in the stock price of Vistra, the largest electricity producer in the US, surpassed Nvidia's, and the price-earnings ratio in 2026 is still below average, which means there is still room for growth.
The boom in “AI power generation stocks” continues.
One of the largest electricity producers and retail energy suppliers in the US after announcing earnings reports last week$Vistra Energy (VST.US)$The stock price has risen again, with a cumulative increase of 298% over the past year, surpassing Nvidia's 223% increase.
Furthermore, the largest nuclear e-commerce company in the US$Constellation Energy (CEG.US)$and the largest photovoltaic producer$NRG Energy (NRG.US)$The cumulative increase over the past year also reached 152% and 182%, respectively.
The surge in power supply stocks stems from the high demand for electricity brought about by the construction and operation of AI data centers.
Constellation's CEO Joseph Dominguez said on the company's earnings call last Thursday that the interest of data center customers “is something we haven't seen in 20 years.”
NRG also said that some data center customers have indicated to the company that they want to triple the capacity of their existing facilities within the next 3 years.
At present, it seems that expectations of high electricity demand are gradually becoming a reality.
The data shows that in rapidly growing data center hubs such as Texas in the US and the mid-Atlantic, long-term electricity prices are already beginning to reflect the tight state of the power grid in the future. In North Texas, for example, the price of full-day forward electricity in 2026 has already risen by about 13%.
This has also led to significant expected profits for power producers:
During the earnings call, Vistra predicted that by 2026, the company's adjusted EBITDA profit may exceed US$6 billion, which is about 24% higher than previous market agencies' expectations. This means that the company's compound annual growth rate for the 2023-2026 period will reach 13%, which is significantly faster than the 3.8% rate in the 2020-2023 period.
NRG Energy said the gross profit of its Texas power generation portfolio could reach US$420 million in the next few years, which is 27% higher than anticipated earlier this year, and that the latter's pricing already includes the risk of rising forward electricity prices.
Constellation has reiterated its basic expectations and expects adjusted revenue to grow by an average of about 10% per year through 2028.
Are “AI power generation stocks” overheated?
But the crazier rise than Nvidia has raised some concerns for investors: are “AI power generation stocks” overheating now?
Investment bank EverCore analysts screened out individual stocks with an average annual EPS (earnings per share) growth rate of 10% under the S&P 500 index and found that their price-earnings ratio in 2026 was 20 times.
According to Wall Street estimates, Vistra and Constellation's average annual EPS growth rates in the 2023-2026 period were 33% and 21%, respectively, and NRG's average EPS growth rate in 2024-2026 was 7.6%. The current price-earnings ratios of the three in 2026 are 17 times, 26 times, and 12 times, respectively. Overall, they are still at a relatively moderate level.
According to some opinions, whether the rise in “AI power generation stocks” can continue depends to a certain extent on how many power purchase contracts power producers can sign with energy-intensive companies and the premium level of these contracts.
Evercore, for example, said that many of Constellation's power storage plants have dual units, which have an advantage in building data centers — assuming that 25% of Constellation's nuclear power plants can sign a power subscription contract with Amazon and have high premium rights in terms of clean and sustainable electricity, their 2026 earnings may be 50% higher than baseline expectations.
Furthermore, the US Environmental Protection Agency (EPA) announced a new proposal for stricter carbon emission standards last month, requiring that the vast majority of US coal-fired and gas-fired power plants must reduce carbon dioxide emissions by 90% by 2038, or else they will be forced to shut down.
According to the opinion, once the proposal is passed and implemented, it may further boost the share prices of clean energy producers.
Editor/Somer