$Vistra(VST.US)
Vistra: AI Needs Power, But VST Needed a Reality Check
AI needs electricity, but that narrative alone could not justify Vistraโs climb toward $220. At roughly $139, VST is down about 37% from its 52-week high of $219.82. (MarketWatch)
The weakness looks more like valuation compression than a fundamental collapse. Q2 2026 revenue fell 5.5% YoY to $4.02 billion and net income to $305 million, while unrealised hedge losses distorted GAAP earnings. More importantly, adjusted EBITDA actually rose 31% to $1.77 billion. Management maintained FY2026 EBITDA guidance of $6.8โ$7.6 billion and free cash flow of $3.925โ$4.725 billion. (Vistra Corp. Investor Relations)
Fundamentally, the AI-power thesis remains attractive, but investors are questioning how quickly data-centre demand converts into earnings. Recent US grid scrutiny over inflated โghost demandโ adds another layer of uncertainty. (Reuters)
At ~$139, valuation has become more interesting: forward P/E is around 13โ15x, materially below VSTโs historical premium. (Yahoo Finance Singapore) Technically, however, momentum remains damaged.
Option writer: favour cash-secured puts rather than chasing shares. Target 20โ30 delta, 30โ60 DTE, preferably strikes around $120โ$130. Demand enough premium to provide a meaningful downside buffer; avoid selling aggressively at 40โ50 delta until momentum stabilises.
Not financial advice.
