Why Did Vistra Stock Drop Today?

Core Viewpoint - Vistra's stock has seen significant growth over the past year, but recent warnings about the challenges of a nuclear power renaissance in the U.S. may impact future performance [1][4]. Group 1: Stock Performance - Vistra's shares have increased by over 120% in the past year, driven by expectations of rising demand for nuclear power due to AI's energy needs and support from President Trump [3]. - However, shares fell by 4.1% following concerns about the feasibility of the nuclear renaissance plan [1]. Group 2: Nuclear Renaissance Challenges - The target set by President Trump for the Nuclear Regulatory Commission to approve reactor design applications within 18 months is considered aggressive and potentially unrealistic, as typical approval times can extend to five years [4]. - The Journal suggests that any growth in nuclear power supply may come from extending licenses of existing reactors or restarting closed reactors, rather than new constructions [4]. Group 3: Financial Outlook - Analysts project strong earnings growth for Vistra, forecasting over 20% annual growth, which could justify the stock's current valuation of 27.5 times earnings [5]. - Vistra's stock appears approximately 20% cheaper when assessed on free cash flow (FCF) compared to GAAP earnings, with a valuation of 23 times FCF and a modest dividend yield of 0.5% [6].