Vistra Corp. (VST)

Conclusion

Vistra Corp. is a US integrated company that sells electricity and natural gas to about 5 million retail customers and runs a generation fleet of about 44,000 megawatts across gas, nuclear, coal, solar and battery storage. At 133.92 USD on 9 November 2026, its market capitalisation is 44.9 billion USD.

The verdict is fair. The P/E of 16.6 sits above its historical median of 13.7, and the price-to-sales ratio of 2.18 sits above its median of 1.33. The discounted cash flow gives 200.07 USD per share at a discount rate of 11.8%. The fair value band runs from 124.25 to 186.37 USD with a midpoint of 155.31 USD, a margin of safety of 16.0% at the current price. The reverse DCF implies growth of 1.9% a year, while revenue grew 9.2% a year over five years.

What supports the case is free cash flow conversion of 157% over the last twelve months, an operating margin of 20.6% against a median of 9.3%, and five-year revenue growth of 9.2% a year. What could break it is interest coverage of 3.98x, which the company's own assessment flags for watching, free cash flow per share that fell 38.5% a year over five years, and current-year estimates cut by 6.2% over 90 days.

Financial health

Financial strength is grey, because too few figures are available to assess it. The only value reported is interest coverage of 3.98x, which is neutral. The current ratio, quick ratio, net debt to EBITDA and debt to equity are not available, and the debt figure is missing from the data. The Altman Z-score is not available because the inputs needed to calculate it are missing, so its zone cannot be stated. The Altman model was designed for manufacturers, which is a further limit for a utility. Insolvency risk: medium, about 4.6% by the estimate of the Ohlson model over one to two years. The estimate uses the 31 December 2025 balance sheet. The cost of debt of 6.9% is an assumption, not a reported figure.

Earnings quality

Earnings quality is green, because cash generation holds up well against reported profit. Free cash flow conversion is 157% over the last twelve months and 167% over five years. The accrual ratio is -7.9%, which means reported earnings are backed by more cash than accounting profit suggests. Stock-based compensation is only 0.07% of revenue, and free cash flow after it is 4.23 billion USD. The share count fell at a compound rate of 6.8% over five years, which points to buybacks. The Piotroski score is 5 out of 9, which is neutral. The Beneish M-score is -2.54, a reading that makes manipulation unlikely. Over the last eight quarters the company beat estimates four times and missed four times, with an average surprise of 6.9%. Estimates for the current year fell 6.2% over 90 days, with three downgrades and one upgrade in the last 30 days.

Profitability

Profitability is green. The gross margin is 34.3% against a median of 31.8%, the operating margin is 20.6% against a median of 9.3%, and the net margin is 13.2% against a median of 2.4%. Operating margin stability is 1.37. Return on invested capital is not available for the last twelve months, so the spread against the cost of capital cannot be quoted. The five-year median return on invested capital is 7.8%, and the weighted average cost of capital is 11.8%. The return on equity is not available as a figure. The DuPont split shows a net margin of 5.3%, an asset turnover of 0.43 and an equity multiplier of 8.1, so high leverage contributes a large part of the return on equity.

Growth

Growth is green. Revenue grew at a compound rate of 8.9% over three years, 9.2% over five years and 12.7% over ten years. Earnings per share grew at a compound rate of 16.1% over five years. Revenue rose in 8 of the 10 comparable years. Free cash flow per share fell at a compound rate of 38.5% over five years, which is a weak point despite the strong growth in revenue and earnings. Analysts expect earnings per share to grow 9.3% next year, but their estimates were cut over the last 90 days.

Valuation

Valuation is yellow, because the current multiples sit above their historical medians while the discounted cash flow points to a higher value. The P/E of 16.6 is a 21.2% premium to its median of 13.7, which is based on five data points. The price-to-free-cash-flow ratio of 10.6 is an 11.4% premium to its median of 9.5. The price-to-sales ratio of 2.18 is a 64.4% premium to its median of 1.33. The free cash flow yield is 9.5% and the earnings yield is 6.0%. The discounted cash flow gives 200.07 USD per share with a discount rate of 11.8%, and the terminal value makes up 46.2% of it. The fair value from historical multiples is 110.54 USD. The fair value band of 124.25 to 186.37 USD is an order-of-magnitude estimate built on fixed assumptions, not a price target. The dividend yield is 1.45% and the payout on free cash flow is 15.4%.

Risks

The weakest figures are interest coverage of 3.98x, which leaves limited room if earnings fall, and an Ohlson insolvency estimate of about 4.6%. Falling free cash flow per share over five years suggests that cash generation per share has not kept pace with revenue, and the price-to-sales premium of 64.4% leaves the stock exposed if growth slows. Cuts to current-year estimates and four misses in eight quarters point to weaker forecasting. The terminal value makes up 46.2% of the discounted cash flow, so a change in the long-term growth assumption would move the result. The current ratio, quick ratio, net debt to EBITDA, debt to equity, Altman Z-score and return on invested capital are not available. This analysis has no debt maturity schedule and no revenue by segment, so refinancing risk and the mix of earnings across the five segments cannot be assessed.