American Electric Power Company (NasdaqGS:AEP) - Share price, News & Analysis

AEP fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	1/6
Past Performance	5/6
Financial Health	1/6
Dividends	4/6

AEP Stock Overview

Rewards

Trading at 1.1% below our estimate of its fair value

Earnings are forecast to grow 8.11% per year

Earnings grew by 15.3% over the past year

Risk Analysis

Debt is not well covered by operating cash flow

Dividend of 3.13% is not well covered by earnings

Significant insider selling over the past 3 months

Shareholders have been diluted in the past year

American Electric Power Company Competitors

NextEra Energy

NYSE:NEE

US$139.9b

Duke Energy

NYSE:DUK

US$84.6b

Southern

NYSE:SO

US$78.0b

Exelon

NasdaqGS:EXC

US$46.2b

Price History & Performance

Summary of all time highs, changes and price drops for American Electric Power Company
Historical stock prices
Current Share Price	US$99.70
52 Week High	US$104.81
52 Week Low	US$80.22
Beta	0.34
1 Month Change	-0.55%
3 Month Change	16.32%
1 Year Change	15.06%
3 Year Change	12.92%
5 Year Change	40.68%
Change since IPO	200.98%

Recent News & Updates

Apr 16

With EPS Growth And More, American Electric Power Company (NASDAQ:AEP) Is Interesting

It's only natural that many investors, especially those who are new to the game, prefer to buy shares in 'sexy' stocks...

Apr 04

Calculating The Fair Value Of American Electric Power Company, Inc. (NASDAQ:AEP)

How far off is American Electric Power Company, Inc. ( NASDAQ:AEP ) from its intrinsic value? Using the most recent...

Shareholder Returns

	AEP	US Electric Utilities	US Market
7D	0.01%	1.0%	-2.7%
1Y	15.1%	4.9%	-12.9%

Return vs Industry: AEP exceeded the US Electric Utilities industry which returned 4.9% over the past year.

Return vs Market: AEP exceeded the US Market which returned -12.9% over the past year.

Price Volatility

Is AEP's price volatile compared to industry and market?
AEP volatility
AEP Average Weekly Movement	2.9%
Electric Utilities Industry Average Movement	3.2%
Market Average Movement	7.8%
10% most volatile stocks in US Market	16.9%
10% least volatile stocks in US Market	2.9%

Stable Share Price: AEP is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: AEP's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1906	16,688	Nick Akins	https://www.aep.com

American Electric Power Company, Inc., an electric public utility holding company, engages in the generation, transmission, and distribution of electricity for sale to retail and wholesale customers in the United States. It operates through Vertically Integrated Utilities, Transmission and Distribution Utilities, AEP Transmission Holdco, and Generation & Marketing segments. The company generates electricity using coal and lignite, natural gas, nuclear, hydro, solar, wind, and other energy sources.

American Electric Power Company Fundamentals Summary

How do American Electric Power Company's earnings and revenue compare to its market cap?
AEP fundamental statistics
Market Cap	US$51.20b
Earnings (TTM)	US$2.63b
Revenue (TTM)	US$17.10b

19.5x

P/E Ratio

3.0x

P/S Ratio

Is AEP overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
AEP income statement (TTM)
Revenue	US$17.10b
Cost of Revenue	US$9.16b
Gross Profit	US$7.95b
Other Expenses	US$5.32b
Earnings	US$2.63b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	5.12
Gross Margin	46.47%
Net Profit Margin	15.36%
Debt/Equity Ratio	154.9%

How did AEP perform over the long term?

See historical performance and comparison

Dividends

3.1%

Current Dividend Yield

58%

Payout Ratio

Valuation

Is American Electric Power Company undervalued compared to its fair value and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

1.1%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: AEP ($99.7) is trading below our estimate of fair value ($100.76)

Significantly Below Fair Value: AEP is trading below fair value, but not by a significant amount.

Price To Earnings Ratio

PE vs Industry: AEP is good value based on its PE Ratio (19.5x) compared to the US Electric Utilities industry average (21.6x).

PE vs Market: AEP is poor value based on its PE Ratio (19.5x) compared to the US market (15.2x).

Price to Earnings Growth Ratio

PEG Ratio: AEP is poor value based on its PEG Ratio (2.4x)

Price to Book Ratio

PB vs Industry: AEP is overvalued based on its PB Ratio (2.2x) compared to the US Electric Utilities industry average (2x).

Future Growth

How is American Electric Power Company forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

8.1%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: AEP's forecast earnings growth (8.1% per year) is above the savings rate (1.9%).

Earnings vs Market: AEP's earnings (8.1% per year) are forecast to grow slower than the US market (12.5% per year).

High Growth Earnings: AEP's earnings are forecast to grow, but not significantly.

Revenue vs Market: AEP's revenue (2.2% per year) is forecast to grow slower than the US market (7.8% per year).

High Growth Revenue: AEP's revenue (2.2% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: AEP's Return on Equity is forecast to be low in 3 years time (11.4%).

Past Performance

How has American Electric Power Company performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

12.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: AEP has high quality earnings.

Growing Profit Margin: AEP's current net profit margins (15.4%) are higher than last year (14.8%).

Past Earnings Growth Analysis

Earnings Trend: AEP's earnings have grown by 12.6% per year over the past 5 years.

Accelerating Growth: AEP's earnings growth over the past year (15.3%) exceeds its 5-year average (12.6% per year).

Earnings vs Industry: AEP earnings growth over the past year (15.3%) exceeded the Electric Utilities industry 9.5%.

Return on Equity

High ROE: AEP's Return on Equity (10.9%) is considered low.

Financial Health

How is American Electric Power Company's financial position?

Financial Health Score

1/6

Financial Health Score 1/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: AEP's short term assets ($8.3B) do not cover its short term liabilities ($13.6B).

Long Term Liabilities: AEP's short term assets ($8.3B) do not cover its long term liabilities ($52.2B).

Debt to Equity History and Analysis

Debt Level: AEP's net debt to equity ratio (151.3%) is considered high.

Reducing Debt: AEP's debt to equity ratio has increased from 115.6% to 154.9% over the past 5 years.

Debt Coverage: AEP's debt is not well covered by operating cash flow (15%).

Interest Coverage: AEP's interest payments on its debt are well covered by EBIT (3.1x coverage).

Balance Sheet

Dividend

What is American Electric Power Company current dividend yield, its reliability and sustainability?

Dividend Score

5/6

Dividend Score 5/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

3.13%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: AEP's dividend (3.13%) is higher than the bottom 25% of dividend payers in the US market (1.58%).

High Dividend: AEP's dividend (3.13%) is low compared to the top 25% of dividend payers in the US market (4.11%).

Stability and Growth of Payments

Stable Dividend: AEP's dividends per share have been stable in the past 10 years.

Growing Dividend: AEP's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (58.2%), AEP's dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: AEP is paying a dividend but the company has no free cash flows.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

4.4yrs

Average management tenure

CEO

Nick Akins (61 yo)

11.33yrs

Tenure

US$15,051,215

Compensation

Mr. Nicholas K. Akins, also known as Nick, has been the Chief Executive Officer of American Electric Power Company, Inc. since November 12, 2011 and its President since January 1, 2011 to October 2011. Mr....

CEO Compensation Analysis

Compensation vs Market: Nick's total compensation ($USD15.05M) is about average for companies of similar size in the US market ($USD13.34M).

Compensation vs Earnings: Nick's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: AEP's management team is considered experienced (4.4 years average tenure).

Board Members

Experienced Board: AEP's board of directors are considered experienced (8.8 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: AEP insiders have only sold shares in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2.8%.

Data	Last Updated (UTC time)
Company Analysis	2022/05/22 00:00
End of Day Share Price	2022/05/20 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31