Vistra Lands Another Data Center PPA, But Size Keeps Thesis Unchanged

What happened

Vistra Corp. has signed a 20-year power purchase agreement to supply 200-207 MW to the first phase of New Era Energy's Texas data center project through its affiliate Luminant ET Services. The deal adds incremental contracted revenue in ERCOT, where the company has been navigating soft power prices and regulatory verification delays for large-load interconnections. While the agreement is a positive signal that data center demand is moving forward, the contracted capacity is modest relative to Vistra's existing 20-year PPAs with Meta (2,609 MW) and AWS (1,200 MW). The master report's core concerns remain unresolved: Cogentrix closing, Meta delivery timing, and ERCOT pricing weakness still dominate the near-term outlook. This new PPA does not alter the WAIT rating or the view that the stock needs a better entry point to provide margin of safety.

Implication

The 200 MW agreement adds another customer to Vistra's ERCOT portfolio, but the size is too small to offset the company's near-term challenges, including soft Texas power prices and ongoing interconnection verification. The deal may indicate that some data center projects are securing power despite regulatory scrutiny, but without disclosed pricing or delivery timeline, the margin impact is unclear. Investors should continue to focus on the key catalysts: Cogentrix closing by year-end 2026, Meta operating deliveries beginning late 2026, and ERCOT Batch Zero verification progress. At current prices around $147, the stock still lacks a sufficient margin of safety, and the report maintains a WAIT rating with an attractive entry below $135. The new PPA is a marginal positive that could accumulate with other deals, but it is not a game-changer for the thesis.

Thesis delta

The new 200 MW PPA is a minor positive that reinforces the data center demand narrative but does not shift the core thesis. It adds another contracted revenue stream in ERCOT, but the modest size and lack of disclosed pricing leave the valuation and timing concerns unchanged. We maintain a WAIT rating with an attractive entry below $135.