Here's Why Vistra Stock Sold Off in February (Hint: It's AI Related)

Core Viewpoint - Vistra's stock experienced a significant decline of 20.5% in February, but long-term investors remain optimistic due to a substantial increase of 464% over the last three years and 123% over the last year, despite the recent drop [1] Group 1: Stock Performance - Vistra's stock price fell by 20.5% in February, coinciding with declines in other power-related companies focused on AI, such as Constellation Energy (down 16.5%) and NuScale Power (down 27.9%) [1][2] - Despite the February decline, Vistra's stock has increased by 464% over the last three years and 123% over the last year [1] Group 2: Nuclear Power Capacity - Vistra has expanded its nuclear power capacity significantly, starting 2024 with 2,400 megawatts (MW) of its total 36,702 MW generating capacity in nuclear, and ending the year with 6,448 MW of its total 40,657 MW in nuclear [3] - The increase in nuclear capability is attributed to the acquisition of Energy Harbor in March [4] Group 3: Market Context and Reactions - The stock sell-off in February was influenced by profit-taking after a strong performance in stocks related to AI themes, triggered by news of Chinese start-up DeepSeek's AI model launch [5] - Concerns arose that DeepSeek's model could reduce demand for power in data centers, affecting long-term growth assumptions and valuations for growth stocks [6] - The news regarding DeepSeek is not entirely negative; increased AI adoption could lead to overall growth in AI demand, and Vistra still has potential for future deals with cloud service providers [7]