Vistra (NYSE: VST) stock surged more than 6% in overnight trading on October 5, putting the power generation giant back in the spotlight after a difficult year for the shares.
By press time, VST stock was trading at $140, with shares up 5.7% to $148 in premarket trading. Earlier in the overnight session, the stock gained as much as 7%, briefly reaching $150.
Why VST stock is rallying
The rally followed reports that the U.S. government is preparing a $4.2 billion financing package to support capacity upgrades at three of Vistra’s nuclear plants in Ohio and Pennsylvania.
The project would expand the company’s nuclear output as electricity demand from AI data centers continues to accelerate across the United States.
Nuclear power has become a key beneficiary of the AI boom, and the reported federal financing package further strengthens Vistra’s position.
The company operates one of the largest power fleets in the U.S. and has secured major long-term electricity agreements with technology companies.
Its largest deals include a multi-decade agreement with Meta Platforms for more than 2,600 megawatts of nuclear power from PJM-region plants and a separate agreement with Amazon Web Services for up to 1,200 megawatts from the Comanche Peak nuclear facility in Texas.
The company has secured additional long-term data center power contracts and participates in the Helix Digital Infrastructure joint venture alongside Nvidia and several investment firms, further strengthening its position in the AI infrastructure market.
Vistra has also attracted attention from high-profile investors Nancy Pelosi and Peter Thiel. Disclosures show Pelosi purchased Vistra call options worth between $500,000 and $1 million in January 2025. She exercised the options in January 2026, converting them into 5,000 shares.
Meanwhile, Thiel Macro LLC reported owning 372,755 Vistra shares worth approximately $59 million in the second quarter of 2026, representing about 14% of the fund’s portfolio. Thiel first established a position in early 2025 before rebuilding a larger stake in the second quarter of 2026.
At the same time, institutional ownership remains strong, with Vanguard and BlackRock among Vistra’s largest shareholders.
Vistra stock fundamentals
Beyond the nuclear financing catalyst, investors are also focused on Vistra’s earnings outlook. The company reaffirmed 2026 adjusted EBITDA guidance of $6.8 billion to $7.6 billion and adjusted free cash flow of $3.9 billion to $4.7 billion, excluding contributions from the Meta agreements and pending Cogentrix acquisition.
For 2027, Vistra expects adjusted EBITDA of $7.4 billion to $7.8 billion, while analysts see additional upside from those contracts, the acquisition, and nuclear production tax credits.
The company remains heavily hedged for 2026, continues returning capital through buybacks and a dividend yielding roughly 0.65% to 0.7%, and is targeting leverage of about 2.3 times.
Risks include weak power prices, particularly in ERCOT, regulatory uncertainty, the integration of Cogentrix, and execution of nuclear upgrades and other major projects.
As hedge coverage declines over time, earnings will become more sensitive to commodity prices, weather, and the pace of AI-driven demand growth.
Featured image via Shutterstock
