Vistra: Power Play or Fading Signal?

by

The air in this business smells like ozone and regret. Artificial intelligence, they say, is driving up demand. Data centers, those humming boxes of silicon and desire, are swallowing electricity like a man possessed. Virginia, a state I hadn’t given much thought to, is now the biggest energy importer. Beats California, a state with a population that could fill a small continent. Figures. Progress always has a price, and somebody always pays the bill.

Vistra Corp [VST 2.32%], they’ve been cleaning up. Up 652% over three years. That kind of number usually attracts attention, the kind that comes with a price tag. The stock dipped recently, a little wobble in the line, and now it’s hovering below $200. Makes the dividend look…interesting. So the question isn’t whether Vistra is a power play, but whether it’s a power play that’s about to fade.

The Texas Grid Game

Vistra’s based in Irving, Texas, a place where the sun beats down and the money flows. They generate about 44,000 megawatts, a hefty chunk of juice, from everything you’d expect – fossil fuels – and the things you’re supposed to feel good about – nuclear, solar. Fifty renewable plants. They’re playing the AI game hard, spending four billion on gas plants in the Northeast and Texas, specifically to feed those data center beasts. Another six point eight billion on nuclear. A cool two billion more on gas plants. They’re buying everything that doesn’t bolt down.

The numbers for the first nine months of 2025 tell a story. Adjusted EBITDA up 13.9% over last year. EBITDA margin at 29.9%. Net profit margin, a respectable 6.99%. They’re turning a profit, alright. And they’re channeling it into a dividend, a yearly ritual since 2019. Used to yield a solid 2-3%. Now? A paltry 0.52%. The stock went on a run, and the yield followed it down. That’s the way things work.

The stock’s up about 6% year to date, trying to erase the recent dip. If it continues, that yield will get even smaller. A shrinking yield is a bad sign, unless you’re looking for capital appreciation. But capital appreciation is a gamble. Dividends are a promise.

Loading widget...

They’re growing that dividend, though. Five-year CAGR of 10.7%. Payout ratio at 32.2%. Plenty of room to keep it growing. That’s a good sign. A company that shares its success is a company I can respect.

The yield isn’t likely to improve much, not without a serious correction. This is a stock to consider for your energy-dividend portfolio, but keep your eyes open. Watch for a dip. A deeper dip. A dip that might actually make the yield worth the risk. Because in this business, you don’t chase returns. You wait for them to come to you. And sometimes, you wait a long time.

Read More

2026-02-24 09:12