Vistra and Constellation Both Fell Sharply After the Election. One Has Far More Exposure to Texas.

Vistra (NYSE: VST) and Constellation Energy (NASDAQ: CEG), two of the largest independent power producers in the United States, both benefited from the rapid growth of the power-hungry data center market. However, both stocks dropped after the Democrats flipped the House, Senate, and five governorships in the midterm elections on Nov. 3.

The biggest shock happened in Texas, where Gina Hinojosa was elected as the state's first Democratic governor in 35 years. Texas has the most data centers under construction of any state. However, Hinojosa plans to extend current governor Greg Abbott's temporary freeze on new environmental and grid-connection permits for data centers until tighter laws are passed, as well as to freeze residential electricity rates across the state.

That announcement broadly drove investors away from AI infrastructure plays like Vistra and Constellation, but one of these stocks is much more heavily exposed to Texas.

Which company is more dependent on the Lone Star State?

Vistra, which is based in Irving, Texas, operates natural gas, nuclear, coal, solar, and battery energy storage facilities with a total capacity of 45 GW. It allocates 20.6 GW (46% of its total capacity) to ERCOT, the Texas electric grid.

Constellation, based in Baltimore, Maryland, operates nuclear, natural gas, oil, geothermal, hydro, wind, and solar facilities totaling 55 GW of capacity. But only 14.5 GW (26% of its total capacity) is located within ERCOT, even after it acquired Alpine in early 2026, which significantly increased its exposure to the Lone Star State.

What other factors should investors consider?

Most of Vistra's capacity comes from natural gas, which provides U.S. data centers with over 40% of their electricity. Constellation allocates more of its capacity to nuclear energy, but its acquisition of Calpine also increased its exposure to the natural gas market.

Vistra and Constellation are both counting on big data center deals to drive their near-term growth. Vistra holds massive power purchasing agreements (PPAs) with Meta and Amazon, and it recently joined a new joint venture -- Helix Digital Infrastructure -- to develop new AI data centers. Constellation holds PPAs with Microsoft, Meta, and Walmar; it's increasing the capacity of its existing plants, and it's in the process of restarting Unit 1 at Three Mile Island (rebranded as the Crane Clean Energy Center) to expand its higher-growth nuclear business.

While both companies remain heavily exposed to the broader market, Vistra is clearly more exposed to recent developments in Texas than Constellation. Therefore, it could remain under more pressure than Constellation until those dark clouds disperse.

Leo Sun has positions in Amazon and Meta Platforms. The Motley Fool has positions in and recommends Amazon, Constellation Energy, Meta Platforms, Microsoft, Vistra, and Walmart. The Motley Fool has a disclosure policy.