David Tepper Has 5% of His Portfolio in This Little-Known Energy Stock. Here's Why.

Appaloosa Management, led by billionaire David Tepper, has allocated 5.12% of its portfolio to Vistra (VSTR), an energy company capitalizing on power demand from AI data centers. The position makes Vistra one of Tepper's top holdings, reflecting his bet on infrastructure plays tied to artificial intelligence growth.

Vistra supplies electricity to millions of customers and has locked in major long-term power purchase agreements with technology companies including Meta. The contracts provide revenue visibility as hyperscalers race to secure stable power sources for expanding data center operations.

The company's financial turnaround accelerated in Q1 2026, posting net income of $1.03 billion versus a $268 million loss in the prior-year quarter. The $1.3 billion year-over-year swing underscores improving margins and capacity utilization as AI-driven power demand takes hold.

Despite the operational momentum, VSTR shares have lagged other AI-linked stocks. The disconnect between Vistra's earnings growth and stock performance may present an opportunity for investors willing to take a position in energy infrastructure rather than direct AI plays.