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billionaire investor David terer from appoa management bought a new stock in Q3 well bought a couple of new stocks but one specific one I want to cover in this video because it is the best performing stock in the S&P 500 it's been a battle it's been Nvidia then it's been palente here well actually no it's been Nvidia then vistra then palente here and now it's vistra yet again as you can see right here did buy or appala management did buy this last quarter a completely new position you also bought energy energy and RG energy should I say now you might say okay new position shouldn't be that big well it's already the 12th largest position in the portfolio he seemed to be extremely bullish on China right number one and number two are Alibaba NP duo duo and that's 26% of the portfolio then you've got Amazon Microsoft meta Google alphabet and then you've got another Chinese company which is JD which she added another 6535 P du du 17325 increase by the way last quarter he did reduce Alibaba a little bit remember he's the guy that said buy everything clearly he didn't buy everything he even sold some but vistra is a new position and it's already in the top 15 now if you don't know what vistra is well you've come to the right place let's discuss that company let's talk about why this company has gone up so much this year and while still today it might actually be a pretty good company to have in your portfolio since well all the AI expectations are going to go on for quite a long period of time and you're going to need quite a lot of energy to make that work not just fossil fuels but nuclear as well renewable energies etc etc that's where vistra comes in so if you're interested in all of that sit back and relax hit all the buttons as well we really appreciate that we are very very close to reaching 60,000 subscribers so thank you very much for all the support and thank you to all the new members of the channel I really appreciate all the support because well you don't really have to do it but I guess you're all super kind so I really appreciate that if you want to support me even further do check out the links down in the description and in the pin comment with the top 10 best stocks to buy now or go to f.com couch investor thank you very much so let's start with a major overview of the stock and the company so V track Corp has a market gap of 51.75 billion as you can see year to date it's up close to 300% it also pays a small dividend has a dividend yield of.
58% and forward PE right now sits at 19.8 times now when you see this number of course we've seen much higher numbers when you look at big tech companies 19.8 times in the next 12 months compared to 29.3 times in the last 12 months okay not that alarming right not that alarming alarming but we have to dig a little bit deeper ev2 sales 3.8 times ev2 Abida 12.6 times now let's see what the analyst are expecting in the coming fiscal year so for fiscal year 2024 they expect sales growth of around 15.5% year-over-year and EPS growing much much quicker 9422 per.
in fiscal year 2025 sales growth of around 14% EPS growing 44.2% and then fiscal year 2026 sales growth continues to de accelerate 6.12% year-over-year growth but EPS growing closer to 12% as I said this is a company that pays a dividend it now has a shareholder yield of 91% so we've got the dividend yield.
57% then you've got a buy back yield you will see they've been buying back quite a lot of shares and then you've got here a small negative impact of The Debt Pay down yield yes it's a company that holds quite a lot of debt but shouldn't really be that much of an issue now with regards to Dividend if you bought this stock back at the end of 2019 you would be getting 13 cents now you are getting 22 cents that's quite an increase right you can see the annualized growth the last 3 years that's closer to 14% as I said this company has been buying back quite a lot of shares in the last 2.8 years Shares are standing have been reduced by close to 30% looking at some pricing metrics and comparing it to the 5-year mean it's pretty clear that it's now is more expensive than before but before bear in mind they were not growing as much as right now right now they're also actually acquiring some companies here and there so that helps with Revenue growth but did hit them with cash flow just for the quarter so you have to take that into consideration but they provided us with some guidance for next year and even for 2026 and it does look like this company is going to be quite a good one and a cash generating one so yes if you look at EV toida if you look at price to sales price to free cash flow it is much much higher than it's 5year mean now to understand a bit what vistra does let me explain it a little bit and play some videos so vistra operates a diverse Fleet of power plants including natural gas nuclear coal and solar facilities the company sells electricity to residential commercial and Industrial customers under various brand names vistra is also investing heav battery storage project to complement its generation portfolio now this year has been the year of nuclear stocks right we've seen quite a lot of nuclear stocks for example OKO the other one Constellation Energy they have been going up and up and up and there are a couple of reasons for that because well big tech companies have started to announce some Partnerships some agreements so we've got one from Google they signed an agreement with caros power to purchase nuclear energy from multiple smrs small modular reactors this deal aims to bring up to 500 megawatt of carbon free power to the United States electricity grids with the first reactor pled to come online by 2030 followed by additional deployments through 2035 and this is what I've been saying for quite a long time nuclear stocks have gone up quite a lot this year right that's in anticipation in anticipation towards a move where well we are going to see a huge transition towards smrs towards nuclear energy but it's going to take a long long time until these things get approved build outs Revival of older plant V1 V2 plans it's going to take a while they will have to figure it out it's not oh they have an agreement and next year we're up and running no nothing like that so yes the stocks have gone up is it worth chasing some are actually already making money such as vistra right now but a lot of the other ones are just in anticipation of well 2030 goals 3035 goals etc etc I'll make a separate video about oo and some others as well it's interesting but there is a lot of future growth already baked in in that stock or in those stocks we also had awsd announced the participation in $500 million of series C1 financing for advanced reactor developer X energy they also partnered with energy Northwest to construct a 4 unit 320 megawatt plant in Washington and with Dominion Energy to explore Advanced reactor development at North Anna power station in Virginia and then we had Microsoft they signed a 20year agreement with Constellation Energy to purchase power and restart the 3M Island unit one nuclear plant in Pennsylvania so of course the big guys are already making some moves now switching back here to vistra what has happened before and what's expected to happen in the future the Revenue growth we've seen already before but look at free cash flow for example free cash flow for 2024 is expected to be 2.5 72 billion then in 2025 $3.4 billion and then in 2026 $3.7 billion so yeah a free cash flow generating company and to be honest I expect this to continue if we then look at total revenue free cash flow margin and gross profit margin it did come down free cash flow margin as I said they've been making some Acquisitions so in this case free cash flow did impacted but of course if you look at adjusted free cash flow then well you're not seeing that negative impact as for the last quarter they delivered $1.44 billion in adjusted eida solid results despite a milder Texas summer versus 2023 they're also upgrading the 2024 adjusted eida guidance range between 5 to 5.2 billion and adjusted free cash flow before growth yeah this is the first time I'm seeing this so adjusted free cash flow before growth guidance to 2.65 to $2.85 billion then for 2025 they're initiating 5.5 to 6.1 billion of adjusted eida they also give us the adjusted free cash flow before growth guidance that will be in the range of three3 to3 3.6 billion and then for 2026 adjusted eida midpoint opportunity of over $6 billion they allocated $3.5 billion to of capital to equity repurchases in Q3 so around $3.1 billion towards vistra Vision minority interest acquisition and around 400 million of open market share repurchases they also have a comprehensive hedging program so they're 100% Hedge for the remainder of 2024 around 96% Hedge for 2025 and now 64% Hedge for 2026 I mean if they can stay on track for that over $6 billion that's the midpoint opportunity for adjusted Aida in 2026 that is quite bullish to be honest quite bullish and it's probably worth paying a small premium today now if we do a quick reverse DCF here I'm using free cash or trilling 12 months we know that for 2024 it's going to be higher than this but we have to use the trailing 12 months one we can see that with this discount rate and terminal growth rate how you reach that basically those two numbers right here we see that implied growth rate to justify today's price is 6.7% meaning they'll have to grow free cash flow by 6.7% in the next 10 years to justify today's price and to be honest I think that is justifiable could even be a little bit higher but of course you want to have some margin of safety here there is also a 2% dilution included in that reverse DCF and I mean we've seen that the market is expecting free cash flow to reach $3.7 billion in 2026 here based on these figures right now $3.7 billion is only expected to be at well year n or so 9.1 9.2 so yeah 6.7 to me is quite reasonable looking at the charts right now well we're back to alltime highs and we are overbought a little bit right now now as you can see previously this stock has been overbought for well a long long period of time actually it was overbought from November 6 2023 all the way to June 2024 so I will keep repeating it again and again because I know not everybody watches the same videos but you can stay overbought for a long period of time and see your stock basically go from $34 all the way to15 $16 and yes these things exist and these things happen now we're back at alltime highs we've seen a nice rebound here in the last 2 weeks from that 50-day moving average it did dip a little bit underneath it but rebounded quite nicely above that so all in all a solid buy I would say for the appala management portfolio it makes sense for them to buy it even I mean even I don't know exactly when he bought it CU those things are outdated a little bit we only get the numbers from what happened last quarter so maybe he's been buying more in the last couple of weeks maybe already sold we don't know but but I mean when you buy stuff you want to buy good companies to hold for a long period of time and I think vistra is in an amazing position to benefit from well everything that's happening with AI but definitely benefiting from moving towards renewable energy moving towards nuclear energy and things like that I think this company is in a perfect position and well there is a reason why right there is a reason why this stock is up 300% year to date so all in all very very good company we'll put it on my watch list we'll maybe cover it more as well if you have it let me know down in the comment section below like subscribe do all of that and I see all in the next one bye-bye
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