S&P Global Ratings Upgrades Vistra Corp. (VST) Buoyed By Acquisitions and Diverse Generation Portfolio

Core Viewpoint - Vistra Corp (NYSE:VST) has been upgraded to investment grade by S&P Global Ratings, reflecting a stable outlook and strong business fundamentals [1][2]. Group 1: Credit Rating Upgrade - S&P Global Ratings upgraded Vistra Corp's credit rating from BBB+ to BBB- due to its stable outlook and recent strategic moves [1][2]. - The upgrade is attributed to a power purchase agreement for the Comanche Peak Nuclear Power Plant and the acquisition of natural assets from Lotus Infrastructure Partners [2]. Group 2: Business Expansion and Portfolio Diversification - The acquisitions have enhanced Vistra's diverse generation portfolio, adding efficient assets in competitive markets such as PJM, New England, New York, and California [3]. - Increased capacity at PJM is viewed as credit-positive, supported by strong market fundamentals leading to favorable auction results [3]. Group 3: Financial Outlook - S&P Global Ratings indicates that Vistra's risk profile has significantly improved, leading to better long-term cash flow visibility [4]. - The company is expected to achieve an adjusted debt to EBITDA ratio in the mid-3.0x range by year-end, decreasing to between 2.6x and 2.8x by 2026 and 2027 [4]. Group 4: Analyst Coverage and Price Target - KeyBanc initiated coverage of Vistra Corp with an Overweight rating and a price target of $217, citing the company's scale, diversified generation mix, and strong cash flow as indicators of long-term prospects [5].