Shares of Vistra (VST -0.32%), the diversified electric utility that uses everything from coal to solar to nuclear to supply power to its customers, plunged 5% in early trading Wednesday before turning around and recovering much of its loss.

As of 1 p.m. ET, Vistra stock remains down -- only 1.6%, granted, but why is it down at all?

Nuclear power plant next to high voltage electricity lines.

Image source: Getty Images.

What spooked Vistra investors today?

After all, the only significant news on Vistra today is of the good variety. As TheFly.com reports, NYC-based Melius Research initiated coverage of Vistra with a buy rating and a $295 price target, implying the stock could rocket 55% over the next 12 months.

Melius is particularly impressed with Vistra's use of batteries in its network, noting Vistra owns the Moss Landing energy storage facility in California, "one of the largest battery storage systems in the world," and is "investing heavily in solar and battery storage."

Melius notes Vistra is "highly acquisitive," too, and seems to consider this a good thing.

Is Vistra stock a buy?

Granted, acquisitions come at a cost, and for utilities this cost often takes the form of debt -- of which Vistra has a boatload, $17.5 billion net of cash. Added to the company's $65 billion market cap, this gives the stock an $83 billion enterprise value, valuing it at nearly 35 times trailing earnings.

Can Vistra grow fast enough to justify such a high multiple?

It might. Analysts polled by S&P Global Market Intelligence have Vistra pegged for 27% annual earnings growth over the next five years. That doesn't seem quite fast enough to me to justify a P/E ratio of 35, but it's not crazy expensive.

At just a slightly better price, I might even agree with Melius that Vistra stock is a buy.