S&P 500 leader Vistra topped third-quarter revenue expectations early Thursday, gave initial 2025 guidance and announced an additional $1 billion for its share repurchasing program. Vistra's Q3 results come along with several other nuclear-related companies on Thursday as the sector has brushed off the rejected nuclear deal between Amazon.com and Talen Energy.
Vistra revenue totaled $6.29 billion, up 54% vs. Q3 2023. Earnings per share fell 24% to $1.24. Analyst consensus put Vistra Q3 EPS at $1.16 on revenue of $5.01 billion. Ongoing operations adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) came in at $1.44 billion, in-line with expectations.
Vistra also raised its 2024 ongoing operations adjusted EBITDA target to $5.0 billion-$5.2 billion from $4.55 billion - $5.05 billion. The company initiated 2025 guidance, expecting adjusted EBITDA of $5.5 billion-$6.1 billion. Analysts put 2025 EBITDA at $5.76 billion.
Along with its 2025 guidance, the Vistra board authorized an additional $1 billion of share repurchases, bringing the current share repurchase authorization to around $2.2 billion, which is expected to be utilized by the end of 2026.
On the earnings call Thursday, Vistra's chief strategy and sustainability officer Stacey Dore said they are "in discussions with two particular large companies about building new gas plants to support a data center project."
"We are currently pursuing deals at multiple sites in our portfolio," Dore said Thursday.
"We're also having some early conversations with some of the developers about a kind of portfolio of approach with one customer, we might be able to pursue co-location deals at multiple sites and combine that with even building some new generation," Dore added. "We're in pretty detailed customer discussions at some of our nuclear sites."
The nuclear power utility's third-quarter announcement comes after Constellation Energy reported better-than-expected third-quarter earnings and revenue while also narrowing its 2024 profit expectations early Monday.
Vistra surged 7.7% to 135.73 during market trade on Thursday. On Wednesday, VST gained 3.4% to 126.09, as leading stocks jumped broadly on former President Donald Trump's election win.
Fellow S&P 500 energy and utilities play Constellation Energy added 2.8% to 241.59 on Thursday, advancing just above the 50-day line.
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CEG and Vistra have surged around 16% and 46%, respectively, since Constellation Energy announced on Sept. 20 a two-decade contract with Microsoft to provide nuclear power for the tech giant's data centers.
Vistra has already secured power purchase agreement from Amazon and Microsoft for its new solar facilities.
VST stock is up 227% on the year while Constellation Energy has advanced 101%.
S&P 500: Nuclear Stocks Brush Off FERC
Amazon in March made an early move toward nuclear, paying $650 million for a Talen Energy nuclear-powered data center campus in Pennsylvania. However, utilities American Electric Power and Exelon lodged protests against the deal, saying it bypassed federal charges incurred by grid operators.
In response, the Federal Energy Regulatory Commission on Friday rejected the deal, citing possible "huge ramifications for both grid reliability and consumer costs," FERC Commissioner Mark Christie said in a statement.
Electric utilities, especially those with nuclear power plants have seen demand and prices soar amid energy-intensive AI data centers. The FERC order suggests that regulators, worried about the "ramifications," may block or restrict co-location deals. Nuclear stocks broadly lost ground Monday on the FERC news.
Constellation Energy Chief Executive Joe Dominguez said on Monday's earnings call that the ruling is "not the final word from FERC on co-location" of data centers at nuclear power plants.
"We know this co-location and competitive markets remains one of the best ways for the U.S. to quickly build the large data centers that are necessary to lead on AI," Dominguez said.
Meanwhile, Bloomberg reported Tuesday that Amazon intends to move forward with Talen project despite the FERC ruling.
Talen stock on Tuesday battled back from its 50-day line, breaking a downtrend and flashed an aggressive entry as it hit an intraday high of 190.10
While a number of Republicans and Democrats have signaled support for nuclear power, Trump recently voiced caution. Trump told Joe Rogan in a late October interview that he believes large nuclear reactor projects are too complex, expensive and that "there's a little danger in nuclear."
However, Trump said at an August rally that "starting on day one, I will approve new drilling, new pipelines, new refineries, new power plants, new reactors and we will slash the red tape."
"We will get the job done. We will create more electricity, also for these new industries that can only function with massive electricity," Trump said.
AI And Nuclear Energy
So far in 2024, nuclear power and utility stocks have been riding the artificial intelligence energy wave.
Artificial intelligence — and the data centers needed to train the systems — are expected to boost energy demand throughout this decade. In the U.S., McKinsey & Co. projects that data center energy demand will grow from around 4% currently, as percentage of total energy demand, to 11%-12% by 2030.
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Many technology companies are investing in or partnering with nuclear power providers to ensure energy supplies for their data centers.
In October, Amazon.com and Alphabet also announced decisions to invest in developing the emerging small modular reactors, or SMRs, technology. No operating SMRs currently exist, but there are a number of companies developing the technology.
Oracle also announced plans in September to build a gigawatt-scale data center powered by three SMRs.
Morgan Stanley analysts have proclaimed in recent months that a "nuclear renaissance" is underway.
They wrote that nuclear power, while still a divisive issue, is making a comeback. The firm sees $1.5 trillion in investment in new capacity through 2050.
Meanwhile, Morgan Stanley analysts wrote that the Constellation-Microsoft deal "proves out the value of nuclear power for hyperscalers, with higher prices for future deals."
Nuclear Stocks Take Off
Small modular reactor-focused companies have taken off recently. Shares of Oklo — the nuclear power startup backed by OpenAI head Sam Altman — surged 177% in October. Nano Nuclear Energy advanced 35% last month.
Meanwhile, NuScale Power gained 65.3% in October.
NuScale Power reported Thursday $500,000 in third-quarter revenue, down from $7 million a year ago. SMR saw a loss of 18 cents per share in the third quarter, down from a 22 cent per share loss in Q3 2023. Prior to Thursday's release, analysts expected a loss of 14 cents per share and revenue totaling $3.9 million.
SMR edged up a fraction early Friday after adding 1.2% on Thursday.
Constellation Energy executives on Monday told analysts that they "continue to lead research on new nuclear energy designs such as our SMRs and for natural gas with sequestration."
Uranium refiner Cameco announced mixed third-quarter earnings on Thursday. The company lost 1-cent per share as revenue climbed 25% to $517.9 million. Analyst consensus projected Q3 EPS of 19 cents with sales of $562 million. Canada-based Cameco is one of the world's largest providers of uranium with utilities around the globe relying on the company to provide nuclear fuel solutions.
CCJ stock gained 0.3% before the market opened Friday after advancing 4.6% Thursday. Shares had been pulling back since an Oct. 18 peak. The stock is close to possible entries.
Vistra stock has a 90 Composite Rating out of a best-possible 99. The S&P 500 leader also has a 98 Relative Strength Rating and a 49 EPS Rating.
Please follow Kit Norton on X @KitNorton for more coverage.
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