Texas-based energy company Vistra Energy (VST) announced that it will retire its Zimmer Power Plant in Moscow, Ohio, by May 31, 2022.
Opened in 1991, the Zimmer Power Plant currently has about 150 employees. It is a single-unit site with a capacity of 1,300 megawatts. The plant is facing several economic hurdles, including configuration, costs, and performance.
The plant was to retire in 2027 due to environmental regulations. The decision to shut down the plant early has been taken after it failed to secure any capacity revenues in the latest auction held in May by the grid operator, PJM.
The company will be evaluating the Zimmer site for potential investments in renewables or grid-scale battery storage and utilizing existing infrastructure. (See Vistra stock chart on TipRanks)
On June 21, Seaport Global analyst Angie Storozynski reiterated a Buy rating on the stock and raised the price target to $22 from $19.50.
The analyst expects EBITDA and free cash flow in the next four years to increase on expectations that higher forward spark spreads will be able to offset lower PJM capacity prices.
Consensus among analysts is a Strong Buy based on 8 unanimous Buys. The average Vistra price target stands at $23.25 and implies upside potential of 30.7% from current levels.
VST scores a 9 out of 10 on TipRanks’ Smart Score rating system, suggesting that the stock is likely to outperform market averages.
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