American Electric Power (AEP)
Market Price (10/31/2026): $130.79 | Market Cap: $71.2 BilInvestor Relations Sector: Utilities | Industry: Electric Utilities
American Electric Power (AEP)
Market Price (10/31/2026): $130.79Market Cap: $71.2 BilSector: UtilitiesIndustry: Electric Utilities
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
Attractive yieldTotal YieldTotal Yield = Earnings Yield + Dividend Yield, Earnings Yield = Net Income / Market Cap Dividend Yield = Total Dividends / Market Cap is 7.7%, Dividend Yield is 2.9% Strong revenue growthRev Chg LTMRevenue Change % Last Twelve Months (LTM) is 11% Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 32%, CFO LTM is 7.6 Bil Low stock price volatilityVol 12M is 18% Megatrend and thematic driversMegatrends include Renewable Energy Transition, and Smart Grids & Grid Modernization. Themes include Solar Energy Generation, Wind Energy Development, Show more. | Debt is significantNet D/ENet Debt/Equity. Debt net of cash. Negative indicates net cash. Equity is taken as the Market Capitalization is 77% Not cash flow generativeFCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is -35% Key risksAEP key risks include [1] successfully executing and financing its massive $72 billion capital plan, Show more. |
| Attractive yieldTotal YieldTotal Yield = Earnings Yield + Dividend Yield, Earnings Yield = Net Income / Market Cap Dividend Yield = Total Dividends / Market Cap is 7.7%, Dividend Yield is 2.9% |
| Strong revenue growthRev Chg LTMRevenue Change % Last Twelve Months (LTM) is 11% |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 32%, CFO LTM is 7.6 Bil |
| Low stock price volatilityVol 12M is 18% |
| Megatrend and thematic driversMegatrends include Renewable Energy Transition, and Smart Grids & Grid Modernization. Themes include Solar Energy Generation, Wind Energy Development, Show more. |
| Debt is significantNet D/ENet Debt/Equity. Debt net of cash. Negative indicates net cash. Equity is taken as the Market Capitalization is 77% |
| Not cash flow generativeFCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is -35% |
| Key risksAEP key risks include [1] successfully executing and financing its massive $72 billion capital plan, Show more. |
Qualitative Assessment
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American Electric Power (AEP) stock has lost about 5% since 6/30/2026 because of the following key factors:
1. Broad Utility Sector Weakness Amid Rising Interest Rates. The utility sector experienced a significant downturn during fiscal Q3 2026, with the overall sector declining by 12.4% and finishing last among major sectors. This decline was largely driven by a rising interest-rate environment, which typically makes interest-sensitive utility stocks less attractive to investors. Higher rates increase borrowing costs for capital-intensive utilities and reduce the relative appeal of their dividend yields compared to fixed-income alternatives.
2. Record-Breaking Industry Rate Hike Requests and Regulatory Uncertainty. In fiscal Q3 2026, electric and gas utilities across the United States requested a new record of $4.5 billion in rate increases, contributing to a year-to-date total of $23.1 billion. This substantial increase in rate requests, often driven by extensive capital expenditure plans for infrastructure upgrades and transmission/distribution investments, can introduce regulatory uncertainty. While essential for revenue generation and return on investment, such large requests can face scrutiny and potential delays from regulators, impacting investor confidence in the sector's ability to recover costs efficiently.
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American Electric Power (AEP) stock has lost about 5% since 6/30/2026 because of the following key factors:
1. Broad Utility Sector Weakness Amid Rising Interest Rates. The utility sector experienced a significant downturn during fiscal Q3 2026, with the overall sector declining by 12.4% and finishing last among major sectors. This decline was largely driven by a rising interest-rate environment, which typically makes interest-sensitive utility stocks less attractive to investors. Higher rates increase borrowing costs for capital-intensive utilities and reduce the relative appeal of their dividend yields compared to fixed-income alternatives.
2. Record-Breaking Industry Rate Hike Requests and Regulatory Uncertainty. In fiscal Q3 2026, electric and gas utilities across the United States requested a new record of $4.5 billion in rate increases, contributing to a year-to-date total of $23.1 billion. This substantial increase in rate requests, often driven by extensive capital expenditure plans for infrastructure upgrades and transmission/distribution investments, can introduce regulatory uncertainty. While essential for revenue generation and return on investment, such large requests can face scrutiny and potential delays from regulators, impacting investor confidence in the sector's ability to recover costs efficiently.
3. Market Valuation Concerns. Leading up to American Electric Power's fiscal Q3 2026 earnings release, the stock was perceived by some analysts as potentially overvalued. As of October 28, 2026, AEP's market price of approximately $130.3 exceeded its GuruFocus Fair Value estimate of $115.12, suggesting it was trading at roughly a 13.2% premium. This overvaluation, despite the company's strong underlying business, may have contributed to a downward price correction as the market adjusted its expectations.
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Stock Movement Drivers
Fundamental Drivers
The -4.1% change in AEP stock from 6/30/2026 to 10/30/2026 was primarily driven by a -12.7% change in the company's Net Income Margin (%).| (LTM values as of) | 6302026 | 10302026 | Change |
|---|---|---|---|
| Stock Price ($) | 135.78 | 130.21 | -4.1% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 22,433 | 23,612 | 5.3% |
| Net Income Margin (%) | 16.3% | 14.2% | -12.7% |
| P/E Multiple | 20.1 | 21.1 | 4.9% |
| Shares Outstanding (Mil) | 542 | 544 | -0.4% |
| Cumulative Contribution | -4.1% |
Market Drivers
6/30/2026 to 10/30/2026| Return | Correlation | |
|---|---|---|
| AEP | -4.1% | |
| Market (SPY) | 1.2% | -8.0% |
| Sector (XLU) | -4.2% | 87.2% |
Fundamental Drivers
The 0.8% change in AEP stock from 3/31/2026 to 10/30/2026 was primarily driven by a 9.3% change in the company's P/E Multiple.| (LTM values as of) | 3312026 | 10302026 | Change |
|---|---|---|---|
| Stock Price ($) | 129.15 | 130.21 | 0.8% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 21,876 | 23,612 | 7.9% |
| Net Income Margin (%) | 16.4% | 14.2% | -13.1% |
| P/E Multiple | 19.3 | 21.1 | 9.3% |
| Shares Outstanding (Mil) | 536 | 544 | -1.6% |
| Cumulative Contribution | 0.8% |
Market Drivers
3/31/2026 to 10/30/2026| Return | Correlation | |
|---|---|---|
| AEP | 0.8% | |
| Market (SPY) | 16.5% | -9.4% |
| Sector (XLU) | -4.8% | 85.2% |
Fundamental Drivers
The 19.3% change in AEP stock from 9/30/2025 to 10/30/2026 was primarily driven by a 32.2% change in the company's P/E Multiple.| (LTM values as of) | 9302025 | 10302026 | Change |
|---|---|---|---|
| Stock Price ($) | 109.11 | 130.21 | 19.3% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 20,666 | 23,612 | 14.3% |
| Net Income Margin (%) | 17.7% | 14.2% | -19.5% |
| P/E Multiple | 16.0 | 21.1 | 32.2% |
| Shares Outstanding (Mil) | 534 | 544 | -1.9% |
| Cumulative Contribution | 19.3% |
Market Drivers
9/30/2025 to 10/30/2026| Return | Correlation | |
|---|---|---|
| AEP | 19.3% | |
| Market (SPY) | 14.4% | -4.4% |
| Sector (XLU) | 1.7% | 78.8% |
Fundamental Drivers
The 92.9% change in AEP stock from 9/30/2023 to 10/30/2026 was primarily driven by a 39.3% change in the company's Net Income Margin (%).| (LTM values as of) | 9302023 | 10302026 | Change |
|---|---|---|---|
| Stock Price ($) | 67.51 | 130.21 | 92.9% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 19,471 | 23,612 | 21.3% |
| Net Income Margin (%) | 10.2% | 14.2% | 39.3% |
| P/E Multiple | 17.5 | 21.1 | 20.7% |
| Shares Outstanding (Mil) | 515 | 544 | -5.4% |
| Cumulative Contribution | 92.9% |
Market Drivers
9/30/2023 to 10/30/2026| Return | Correlation | |
|---|---|---|
| AEP | 92.9% | |
| Market (SPY) | 82.9% | 4.3% |
| Sector (XLU) | 60.0% | 74.2% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| AEP Return | 11% | 10% | -11% | 18% | 29% | 16% | 92% |
| Peers Return | 17% | 15% | 5% | 34% | 25% | 5% | 148% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 13% | 106% |
Monthly Win Rates [3] | |||||||
| AEP Win Rate | 50% | 67% | 58% | 58% | 67% | 50% | |
| Peers Win Rate | 56% | 61% | 58% | 58% | 63% | 50% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 50% | |
Max Drawdowns [4] | |||||||
| AEP Max Drawdown | -11% | -22% | -25% | -13% | -9% | -15% | |
| Peers Max Drawdown | -10% | -24% | -18% | -15% | -19% | -19% | |
| S&P 500 Max Drawdown | -5% | -25% | -10% | -8% | -19% | -9% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: LNT, SO, CEG, DUK, AEP. See AEP Returns vs. Peers.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 10/30/2026 (YTD)
How Low Can It Go
| Event | AEP | S&P 500 |
|---|---|---|
| Summer-Fall 2023 Five Percent Yield Shock | ||
| % Loss | -17.7% | -9.5% |
| % Gain to Breakeven | 21.5% | 10.5% |
| Time to Breakeven | 147 days | 24 days |
| 2020 COVID-19 Crash | ||
| % Loss | -32.4% | -33.7% |
| % Gain to Breakeven | 47.9% | 50.9% |
| Time to Breakeven | 714 days | 140 days |
| 2016-2017 Trump Reflation Bond Selloff | ||
| % Loss | -10.2% | -3.7% |
| % Gain to Breakeven | 11.3% | 3.9% |
| Time to Breakeven | 82 days | 6 days |
| 2013 Taper Tantrum | ||
| % Loss | -16.5% | -0.2% |
| % Gain to Breakeven | 19.7% | 0.2% |
| Time to Breakeven | 154 days | 1 days |
| 2008-2009 Global Financial Crisis | ||
| % Loss | -46.0% | -53.4% |
| % Gain to Breakeven | 85.1% | 114.4% |
| Time to Breakeven | 962 days | 1085 days |
In The Past
American Electric Power's stock fell -3.5% during the 2025 US Tariff Shock. Such a loss loss requires a 3.6% gain to breakeven.
Preserve Wealth
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Asset Allocation
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| Event | AEP | S&P 500 |
|---|---|---|
| 2020 COVID-19 Crash | ||
| % Loss | -32.4% | -33.7% |
| % Gain to Breakeven | 47.9% | 50.9% |
| Time to Breakeven | 714 days | 140 days |
| 2008-2009 Global Financial Crisis | ||
| % Loss | -46.0% | -53.4% |
| % Gain to Breakeven | 85.1% | 114.4% |
| Time to Breakeven | 962 days | 1085 days |
In The Past
American Electric Power's stock fell -3.5% during the 2025 US Tariff Shock. Such a loss loss requires a 3.6% gain to breakeven.
Preserve Wealth
Limiting losses and compounding gains is essential to preserving wealth.
Asset Allocation
Actively managed asset allocation strategies protect wealth. Learn more.
About American Electric Power (AEP)
American Electric Power (AEP) is a major electric public utility holding company that operates across the United States. Its core business involves the full spectrum of electricity delivery: generating power from a diverse mix of sources including coal, natural gas, nuclear, hydro, solar, and wind, as well as transmitting and distributing that electricity through its extensive network.
The company's primary service is providing electricity. AEP serves a broad customer base, selling electricity directly to retail customers in various states and also supplying and marketing electric power at wholesale. Its wholesale customers include other electric utility companies, rural electric cooperatives, municipalities, and other market participants, fulfilling their power needs across different regions.
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Here are a few brief analogies for American Electric Power (AEP):
- The AT&T of electricity
- Shell or BP for electricity
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- Retail Electricity Services: Providing electricity through generation, transmission, and distribution directly to residential and commercial customers.
- Wholesale Electric Power Sales: Supplying and marketing electric power in bulk to other utility companies, rural electric cooperatives, municipalities, and other market participants.
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American Electric Power (AEP) operates as an electric public utility, serving a broad base of customers. While it engages in both retail and wholesale activities, its primary focus in terms of direct customer accounts and service responsibility is directed towards end-users within its regulated service territories. Therefore, its major customers can be categorized as follows:
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Residential Customers: This category includes individual households and families who purchase electricity for personal use in their homes.
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Commercial Customers: Comprising various businesses such as offices, retail establishments, restaurants, and other non-industrial enterprises that consume electricity for their operations.
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Industrial Customers: This segment consists of large-scale industrial facilities, manufacturing plants, and other major operations that require substantial amounts of electricity.
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William J. Fehrman, Chairman of the Board of Directors, President and Chief Executive Officer
William J. Fehrman assumed the role of President and Chief Executive Officer of American Electric Power effective August 1, 2024. Prior to joining AEP, Mr. Fehrman served as president and CEO of Centuri Holdings Inc., where he was instrumental in launching it as a public company. From 2018 to 2023, he held the positions of president, CEO, and director at Berkshire Hathaway Energy (BHE), a subsidiary of Berkshire Hathaway. His career also includes leadership as president and CEO of MidAmerican Energy Company, PacifiCorp Energy, and Nebraska Public Power District.
Trevor I. Mihalik, Executive Vice President and Chief Financial Officer
Trevor I. Mihalik was appointed Executive Vice President and Chief Financial Officer of American Electric Power, effective January 20, 2025, succeeding Charles Zebula. Mr. Mihalik brings over three decades of experience in the energy sector. Most recently, he served as group president at Sempra, a utility holding company, and held various leadership roles in Sempra's finance organization for more than 12 years. Prior to Sempra, he led the finance teams for Iberdrola Renewables Holdings, Chevron Natural Gas, and Bridgeline Holdings.
Therace Risch, Executive Vice President and Chief Information & Technology Officer
Therace Risch is the Executive Vice President and Chief Information & Technology Officer at AEP, a position she has held since joining the company in May 2020. In this role, she is responsible for enterprise-wide technology strategy, execution, and operations, including IT infrastructure, cyber, and telecommunications, as well as innovation, physical security, and aviation. Before her tenure at AEP, Ms. Risch was executive vice president and Chief Information Officer for JCPenney, where she oversaw IT systems and played a key role in the company's stabilization and turnaround efforts. Her experience also includes serving as executive vice president and Chief Information Officer at COUNTRY Financial and 10 years in various technology leadership roles at Target Corp.
David M. Feinberg, Executive Vice President, General Counsel and Secretary
David M. Feinberg serves as Executive Vice President, General Counsel and Secretary for American Electric Power, responsible for all corporate legal affairs. He joined AEP in May 2011 as senior vice president and general counsel of AEP Service Corp. Previously, he was vice president, general counsel, and corporate secretary of Allegheny Energy, Inc. His earlier career also includes serving as senior litigation counsel and deputy general counsel at Allegheny Energy and as a partner at the law firm Jenner & Block, specializing in complex commercial litigation.
Phil Ulrich, Executive Vice President and Chief Human Resources Officer
Phil Ulrich is the Executive Vice President and Chief Human Resources Officer at American Electric Power.
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- Regulatory Friction and Capital Recovery: As a regulated utility, American Electric Power's financial health and its ability to execute its substantial capital investment plans, including a projected $72 billion over five years, heavily depend on timely approval from state and federal regulators for cost recovery and a fair return. Delays in rate cases or unfavorable regulatory decisions can significantly hinder the company's financial performance and its capacity to finance grid modernization and respond to increased demand from large commercial customers like data centers. This regulatory uncertainty is identified as a primary risk, particularly in regions like Ohio.
- Financial Market Volatility and Funding of Capital Investments: American Electric Power's capital-intensive business model requires continuous and substantial investments in infrastructure. The company's ability to fund these significant capital expenditures and refinance maturing debt is susceptible to volatility in financial markets, including increased interest rates and reduced liquidity. Restricted access to capital or higher borrowing costs could negatively impact its financial condition, cash flows, and ability to implement its strategic growth plans.
- Transition to Clean Energy and Dependence on Coal: Despite a diversified energy portfolio, American Electric Power has a notable reliance on coal for generation, with coal representing 42% of its capacity as of early 2026. This dependence exposes the company to risks associated with the accelerating shift towards cleaner energy sources, potential carbon taxation, and increasingly stringent environmental regulations. The ongoing costs of operating older fossil fuel units and the physical risks stemming from climate change, such as more severe weather events impacting infrastructure, further contribute to this significant business risk.
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American Electric Power (AEP) primarily operates in the generation, transmission, and distribution of electricity for retail and wholesale customers in the United States.
Addressable Markets for Main Products or Services (U.S.)
The addressable market for American Electric Power's main products and services encompasses the overall U.S. electricity sector, given its extensive operations as one of the largest electric utility companies in the country.
- Total U.S. Electricity Market Revenue: In 2023, the U.S. electricity industry earned approximately $491 billion in revenue.
- Total U.S. Electricity Generation: The United States generated approximately 4,178 billion kilowatt-hours (kWh) (or 4.178 Terawatt-hours) of electricity in 2023.
- Total U.S. Retail Electricity Sales: U.S. retail electricity sales to end-use customers were about 3,861 billion kWh in 2023, and approximately 4.10 trillion kWh (4,100 billion kWh) in 2024.
American Electric Power serves over 5 million customers across an 11-state territory, covering approximately 197,500 square miles, primarily through its regulated utility operations. Its operations include a significant electricity transmission system, which is one of the largest in the United States.
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American Electric Power (AEP) is poised for future revenue growth over the next two to three years, driven by substantial capital investments, unprecedented customer demand, and a strategic focus on renewable energy and grid modernization.
Here are 3-5 expected drivers of future revenue growth:
- Significant Capital Investment Plan and Rate Base Growth: AEP has outlined an ambitious $72 billion five-year capital plan for 2026-2030, which is a substantial increase from previous plans. This investment is primarily directed towards enhancing its electricity generation, transmission, and distribution infrastructure. These capital expenditures are expected to drive a 10% compounded annual growth rate (CAGR) in the company's rate base through 2030. As a regulated utility, AEP earns a regulated return on its rate base, meaning these infrastructure investments are a direct driver of future revenue.
- Unprecedented Load Growth, Particularly from Data Centers and Industrial Customers: The company is experiencing a significant surge in demand from large-load commercial and industrial customers, with data centers being a primary catalyst. AEP has doubled its outlook for incremental contracted load growth to 56 gigawatts (GW) by 2030, all supported by signed customer agreements. This robust demand growth, observed across key service territories, fuels the need for AEP's extensive capital investment plan and contributes directly to higher electricity sales.
- Expansion of Renewable Energy Generation Portfolio: AEP is strategically investing in and expanding its renewable energy generation portfolio, including solar and wind projects. The company plans to allocate approximately $8 billion to regulated renewable projects between 2026 and 2030. This initiative aims to meet evolving customer demands, support sustainability goals, and diversify AEP's energy mix, with a target of 50% renewable generation by 2030. These new clean energy assets will contribute to revenue through their inclusion in the rate base and subsequent regulated returns.
- Transmission and Distribution System Modernization: A significant portion of AEP's capital plan, approximately $30 billion, is dedicated to modernizing and expanding its transmission and distribution networks. These investments are crucial for enhancing grid reliability, integrating new generation sources, and efficiently serving the rapidly increasing customer demand, especially from large industrial loads. The expansion and upgrades to this critical infrastructure will contribute to rate base growth and allow for improved service delivery, which can translate into approved rate increases.
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Share Repurchases
- American Electric Power (AEP) has not made significant share repurchases in the last 3-5 years, with reports indicating $0.00 in share buybacks over the last four quarters and four years up to September 2025.
Share Issuance
- In March 2025, AEP announced a registered underwritten offering of $2.0 billion of its common stock, with an option for underwriters to purchase an additional $300 million.
- During the first quarter of 2025, the company completed a $2.3 billion forward equity issuance.
- These issuances were part of the company's strategy to de-risk its financing plan for capital investments.
Inbound Investments
- In June 2025, KKR and PSP Investments jointly invested $2.82 billion for a 19.9% equity interest in AEP's Ohio and Indiana Michigan transmission companies.
- In late 2025, AEP secured a $1.6 billion federal loan guarantee from the U.S. Department of Energy. This funding is designated for upgrading transmission lines to enhance grid capacity for data centers and AI manufacturing.
Capital Expenditures
- From 2021 through 2025, AEP planned to invest $37 billion, with significant allocations including $26.7 billion for transmission and distribution operations and $2.8 billion for regulated renewable generation.
- AEP outlined a $54 billion capital investment plan for 2025-2029, with 100% allocated to regulated businesses. This plan earmarks 63% ($34 billion) for transmission and distribution ("wires") and 26% ($14 billion) for regulated new generation, including renewables.
- In late 2025, the company's five-year capital plan was further expanded to $72 billion, a 33% increase from the previous plan, driven by significant load growth from data centers and other large customer agreements, with over $7 billion allocated to solar, wind, and storage.
Peer Outperformance in Electric Utilities
| Ticker | Name | Rev Growth 3Y Avg | P/E | 1Y | 3Y | 5Y | 5Y Gap |
|---|---|---|---|---|---|---|---|
| AEP | American Electric Power | 7.1% | 21.1x | 10.1% | 92.1% | 84.0% | — |
| VST | Vistra | 6.7% | 21.0x | -26.6% | 333.8% | 669.6% | +586pp |
| Industry | Names | 1Y med | 3Y med | 5Y med | Top 3 by 5Y |
|---|---|---|---|---|---|
| Independent Power Producers & Energy Traders | 5 | -43.8% | 112.3% | 148.5% | NRG 172% · OKLO 149% · TAC 26% |
| Multi-Utilities | 18 | 7.4% | 58.5% | 51.7% | NI 112% · PNW 105% · MDU 100% |
| Electric Utilities ← | 24 | 5.8% | 54.4% | 50.3% | VST 670% · ETR 157% · AEP 84% |
| Gas Utilities | 10 | 8.1% | 67.7% | 49.3% | ATO 112% · SR 74% · NJR 69% |
| Water Utilities | 11 | 7.9% | 4.6% | -7.7% | WTRG 9% · AWR 6% · HTO 3% |
| Renewable Electricity | 6 | -72.1% | -67.0% | -86.8% | ORA 28% · CWEN 18% |
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Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 127.53 |
| Mkt Cap | 94.5 |
| Rev LTM | 30,178 |
| Op Inc LTM | 5,630 |
| FCF LTM | -3,269 |
| FCF 3Y Avg | -1,953 |
| CFO LTM | 7,580 |
| CFO 3Y Avg | 6,950 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 6.4% |
| Rev Chg 3Y Avg | 4.6% |
| Rev Chg Q | 6.2% |
| QoQ Delta Rev Chg LTM | 1.7% |
| Op Inc Chg LTM | 5.4% |
| Op Inc Chg 3Y Avg | 15.3% |
| Op Mgn LTM | 23.8% |
| Op Mgn 3Y Avg | 23.1% |
| QoQ Delta Op Mgn LTM | 0.4% |
| CFO/Rev LTM | 32.1% |
| CFO/Rev 3Y Avg | 32.4% |
| FCF/Rev LTM | -10.8% |
| FCF/Rev 3Y Avg | -6.0% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 94.5 |
| P/S | 3.0 |
| P/Op Inc | 14.6 |
| P/EBIT | 12.6 |
| P/E | 21.2 |
| P/CFO | 10.0 |
| Total Yield | 7.7% |
| Dividend Yield | 2.9% |
| FCF Yield 3Y Avg | -2.2% |
| D/E | 0.7 |
| Net D/E | 0.7 |
Returns
| Median | |
|---|---|
| Name | |
| 1M Rtn | 11.9% |
| 3M Rtn | 1.7% |
| 6M Rtn | -2.0% |
| 12M Rtn | 5.4% |
| 3Y Rtn | 61.7% |
| 1M Excs Rtn | 11.1% |
| 3M Excs Rtn | -0.2% |
| 6M Excs Rtn | -9.1% |
| 12M Excs Rtn | -6.2% |
| 3Y Excs Rtn | -23.1% |
Comparison Analyses
Segment Financials
Revenue by Segment| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Vertically Integrated Utilities (VIU) | 12,819 | 11,597 | 11,450 | 11,478 | 9,998 |
| Transmission and Distribution Utilities (T&D) | 6,147 | 5,908 | 5,713 | 5,512 | 4,493 |
| Generation & Marketing (G&M) | 2,762 | 2,045 | 1,632 | 2,467 | 2,164 |
| American Electric Power Transmission Holdco (AEPTHCo) | 2,377 | 1,951 | 1,729 | 1,677 | 1,526 |
| Corporate and Other | 144 | 183 | 168 | 110 | 72 |
| Reconciling Adjustments | -2,373 | -1,963 | -1,710 | -1,604 | -1,462 |
| Total | 21,876 | 19,721 | 18,982 | 19,640 | 16,792 |
| $ Mil | 2007 | 2002 | 2001 |
|---|---|---|---|
| Utility Operations | 2,205 | ||
| Energy Delivery | 970 | 986 | |
| Other | -549 | 278 | |
| Wholesale | 645 | 1,418 | |
| Total | 2,205 | 1,066 | 2,682 |
| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Vertically Integrated Utilities (VIU) | 1,605 | 1,453 | 1,090 | 1,292 | 1,117 |
| American Electric Power Transmission Holdco (AEPTHCo) | 1,161 | 790 | 703 | 674 | 682 |
| Transmission and Distribution Utilities (T&D) | 816 | 726 | 699 | 596 | 543 |
| Generation & Marketing (G&M) | 287 | 289 | -26 | 284 | 210 |
| Reconciling Adjustments | 0 | 0 | 0 | 0 | 0 |
| Corporate and Other | -289 | -291 | -258 | -538 | -64 |
| Total | 3,580 | 2,967 | 2,208 | 2,307 | 2,488 |
| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Vertically Integrated Utilities (VIU) | 61,778 | 54,997 | 51,802 | 49,762 | 46,974 |
| Transmission and Distribution Utilities (T&D) | 29,272 | 26,864 | 24,838 | 22,920 | 21,120 |
| American Electric Power Transmission Holdco (AEPTHCo) | 19,719 | 18,012 | 16,576 | 15,216 | 13,873 |
| Corporate and Other | 6,733 | 5,551 | 5,194 | 6,834 | 5,846 |
| Generation & Marketing (G&M) | 2,003 | 1,634 | 2,598 | 4,520 | 4,264 |
| Reconciling Adjustments | -5,045 | -3,980 | -4,325 | -5,783 | -4,409 |
| Total | 114,460 | 103,078 | 96,684 | 93,469 | 87,669 |
Price Behavior
| Market Price | $130.21 | |
| Market Cap ($ Bil) | 70.9 | |
| First Trading Date | 01/02/1970 | |
| Distance from 52W High | -5.4% | |
| 50 Days | 200 Days | |
| DMA Price | $123.35 | $126.98 |
| DMA Trend | down | up |
| Distance from DMA | 5.6% | 2.5% |
| 3M | 1YR | |
| Volatility | 16.9% | 18.4% |
| Downside Capture | -4.93 | -15.13 |
| Upside Capture | 1.71 | -3.42 |
| Correlation (S&P 500) | -4.0% | -3.7% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | 0.51 | 0.29 | 0.06 | -0.06 | -0.02 | 0.07 |
| Up Beta | -0.25 | 0.20 | 0.04 | -0.09 | -0.12 | 0.02 |
| Down Beta | 0.29 | -0.27 | 0.47 | -0.04 | 0.02 | 0.01 |
| Up Capture | 49% | 13% | -29% | -11% | 4% | 6% |
| Bmk +ve Days | 6 | 16 | 27 | 66 | 132 | 424 |
| Stock +ve Days | 11 | 22 | 31 | 63 | 132 | 397 |
| Down Capture | 91% | 86% | 48% | 6% | -11% | 7% |
| Bmk -ve Days | 16 | 26 | 37 | 60 | 120 | 328 |
| Stock -ve Days | 11 | 20 | 33 | 63 | 119 | 351 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with AEP | |
|---|---|---|---|---|
| AEP | 10.0% | 18.4% | 0.37 | - |
| Sector ETF (XLU) | -1.6% | 15.7% | -0.30 | 84.2% |
| Equity (SPY) | 10.9% | 12.8% | 0.52 | -4.8% |
| Gold (GLD) | -2.0% | 28.6% | -0.08 | 2.3% |
| Commodities (DBC) | 48.2% | 20.6% | 1.79 | -6.5% |
| Real Estate (VNQ) | 10.2% | 13.7% | 0.45 | 47.1% |
| Bitcoin (BTCUSD) | -30.3% | 43.5% | -0.71 | -6.7% |
Smart multi-asset allocation framework can stack odds in your favor. Learn How
Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with AEP | |
|---|---|---|---|---|
| AEP | 12.8% | 20.2% | 0.50 | - |
| Sector ETF (XLU) | 8.3% | 17.4% | 0.32 | 82.2% |
| Equity (SPY) | 12.2% | 17.1% | 0.53 | 23.7% |
| Gold (GLD) | 16.2% | 19.0% | 0.68 | 13.1% |
| Commodities (DBC) | 9.2% | 19.5% | 0.35 | 6.2% |
| Real Estate (VNQ) | 0.9% | 18.9% | -0.06 | 52.8% |
| Bitcoin (BTCUSD) | 4.8% | 51.6% | 0.28 | 2.0% |
Smart multi-asset allocation framework can stack odds in your favor. Learn How
Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with AEP | |
|---|---|---|---|---|
| AEP | 11.4% | 21.0% | 0.48 | - |
| Sector ETF (XLU) | 9.4% | 19.3% | 0.41 | 85.9% |
| Equity (SPY) | 15.2% | 17.9% | 0.72 | 35.8% |
| Gold (GLD) | 11.4% | 16.5% | 0.56 | 12.7% |
| Commodities (DBC) | 8.2% | 18.1% | 0.37 | 6.3% |
| Real Estate (VNQ) | 5.3% | 20.7% | 0.21 | 57.4% |
| Bitcoin (BTCUSD) | 61.7% | 66.2% | 1.01 | 3.4% |
Smart multi-asset allocation framework can stack odds in your favor. Learn How
Earnings Returns History
Updated 10/31/2026| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 10/28/2026 | -1.6% | ||
| 7/30/2026 | -1.3% | -2.3% | -4.4% |
| 5/5/2026 | 1.8% | -2.2% | -5.5% |
| 2/12/2026 | 3.4% | 5.0% | 9.3% |
| 10/29/2025 | 6.1% | 4.5% | 7.5% |
| 7/30/2025 | 3.7% | 3.7% | 4.2% |
| 5/6/2025 | 0.0% | -5.2% | -4.4% |
| 2/13/2025 | -1.3% | 2.0% | 3.1% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 14 | 15 | 14 |
| # Negative | 11 | 9 | 10 |
| Median Positive | 2.1% | 2.2% | 6.9% |
| Median Negative | -1.3% | -2.9% | -5.0% |
| Max Positive | 6.1% | 7.8% | 13.9% |
| Max Negative | -4.1% | -6.5% | -9.1% |
| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 10/28/2026 | -1.6% | ||
| 7/30/2026 | -1.3% | -2.3% | -4.4% |
| 5/5/2026 | 1.8% | -2.2% | -5.5% |
| 2/12/2026 | 3.4% | 5.0% | 9.3% |
| 10/29/2025 | 6.1% | 4.5% | 7.5% |
| 7/30/2025 | 3.7% | 3.7% | 4.2% |
| 5/6/2025 | 0.0% | -5.2% | -4.4% |
| 2/13/2025 | -1.3% | 2.0% | 3.1% |
| 11/6/2024 | -4.1% | -6.5% | -2.0% |
| 7/30/2024 | 1.1% | 1.0% | 2.4% |
| 4/30/2024 | -0.7% | 2.5% | 1.9% |
| 2/26/2024 | 4.1% | 5.2% | 2.1% |
| 11/2/2023 | 3.6% | 2.2% | 6.5% |
| 7/27/2023 | -2.7% | -3.5% | -9.1% |
| 5/4/2023 | 0.6% | 1.9% | -7.3% |
| 2/23/2023 | -0.1% | -4.9% | -6.0% |
| 10/27/2022 | -0.3% | 0.9% | 10.2% |
| 7/27/2022 | -0.1% | 2.1% | 7.3% |
| 4/28/2022 | 2.9% | 1.2% | 3.9% |
| 2/24/2022 | 2.3% | 7.8% | 13.9% |
| 10/28/2021 | 0.5% | 0.7% | -1.2% |
| 7/22/2021 | 0.2% | 5.0% | 7.6% |
| 4/22/2021 | -1.6% | -2.9% | -2.6% |
| 2/25/2021 | -1.0% | -1.0% | 9.9% |
| 10/22/2020 | 2.0% | -0.1% | -8.0% |
| SUMMARY STATS | |||
| # Positive | 14 | 15 | 14 |
| # Negative | 11 | 9 | 10 |
| Median Positive | 2.1% | 2.2% | 6.9% |
| Median Negative | -1.3% | -2.9% | -5.0% |
| Max Positive | 6.1% | 7.8% | 13.9% |
| Max Negative | -4.1% | -6.5% | -9.1% |
SEC Filings
Expand for More| Report Date | Filing Date | Filing |
|---|---|---|
| 09/30/2026 | 10/28/2026 | 10-Q |
| 06/30/2026 | 07/30/2026 | 10-Q |
| 03/31/2026 | 05/05/2026 | 10-Q |
| 12/31/2025 | 02/12/2026 | 10-K |
| 09/30/2025 | 10/29/2025 | 10-Q |
| 06/30/2025 | 07/30/2025 | 10-Q |
| 03/31/2025 | 05/06/2025 | 10-Q |
| 12/31/2024 | 02/13/2025 | 10-K |
| 09/30/2024 | 11/06/2024 | 10-Q |
| 06/30/2024 | 07/30/2024 | 10-Q |
| 03/31/2024 | 04/30/2024 | 10-Q |
| 12/31/2023 | 02/26/2024 | 10-K |
| 09/30/2023 | 11/02/2023 | 10-Q |
| 06/30/2023 | 07/27/2023 | 10-Q |
| 03/31/2023 | 05/04/2023 | 10-Q |
| 12/31/2022 | 02/23/2023 | 10-K |
| Report Date | Filing Date | Filing |
|---|---|---|
| 09/30/2026 | 10/28/2026 | 10-Q |
| 06/30/2026 | 07/30/2026 | 10-Q |
| 03/31/2026 | 05/05/2026 | 10-Q |
| 12/31/2025 | 02/12/2026 | 10-K |
| 09/30/2025 | 10/29/2025 | 10-Q |
| 06/30/2025 | 07/30/2025 | 10-Q |
| 03/31/2025 | 05/06/2025 | 10-Q |
| 12/31/2024 | 02/13/2025 | 10-K |
| 09/30/2024 | 11/06/2024 | 10-Q |
| 06/30/2024 | 07/30/2024 | 10-Q |
| 03/31/2024 | 04/30/2024 | 10-Q |
| 12/31/2023 | 02/26/2024 | 10-K |
| 09/30/2023 | 11/02/2023 | 10-Q |
| 06/30/2023 | 07/27/2023 | 10-Q |
| 03/31/2023 | 05/04/2023 | 10-Q |
| 12/31/2022 | 02/23/2023 | 10-K |
| 09/30/2022 | 10/27/2022 | 10-Q |
| 06/30/2022 | 07/27/2022 | 10-Q |
| 03/31/2022 | 04/28/2022 | 10-Q |
| 12/31/2021 | 02/24/2022 | 10-K |
| 09/30/2021 | 10/28/2021 | 10-Q |
| 06/30/2021 | 07/22/2021 | 10-Q |
| 03/31/2021 | 04/22/2021 | 10-Q |
| 12/31/2020 | 02/25/2021 | 10-K |
| 09/30/2020 | 10/22/2020 | 10-Q |
| 06/30/2020 | 08/06/2020 | 10-Q |
| 03/31/2020 | 05/06/2020 | 10-Q |
| 12/31/2019 | 02/20/2020 | 10-K |
Recent Forward Guidance
Updated 10/29/2026Latest: Q3 2026 Earnings Reported 10/28/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2026 Operating EPS | Reported | 6.25 | 6.4 | 6.55 | 0.0% | Affirmed | Guidance: 6.4 for 2026 | |
| 2026 GAAP EPS | Reported | 6.11 | 6.26 | 6.41 | ||||
| 2027 Operating EPS | Reported | 6.75 | 6.9 | 7.05 | ||||
| 2028 Operating EPS | Reported | 7.4 | 7.55 | 7.7 | ||||
| 2031 Operating Earnings CAGR | Reported | 0.1 | 0.1 | |||||
| 2031 Five-Year Capital Plan | Reported | 100.00 Bil | 28.2% | Higher New | Guidance: 78.00 Bil for 2030 | |||
| 2031 Rate Base CAGR | Reported | 0.13 | 0.13 | |||||
| 2031 Rate Base | Reported | 162.00 Bil | ||||||
| 2031 Transmission Capital Investment | Reported | 37.00 Bil | ||||||
| 2031 Transmission Rate Base | Reported | 70.00 Bil | ||||||
| 2031 Generation Capital Investment | Reported | 36.00 Bil | ||||||
| 2031 Distribution Capital Investment | Reported | 22.00 Bil | ||||||
| 2031 Incremental Contracted Load | Reported | 84 | ||||||
| 2031 Operating EPS Annual Growth Rate | Reported | 9.0% | 10.0% | 11.0% | 2.0% | Higher New | Guidance: 8.0% for 2030 | |
Prior: Q2 2026 Earnings Reported 7/30/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2026 Operating EPS | Reported | 6.25 | 6.4 | 6.55 | 1.6% | Raised | Guidance: 6.3 for 2026 | |
| 2030 Operating Earnings Growth Rate | Reported | 7.0% | 8.0% | 9.0% | -1.0% | Affirmed | Guidance: 9.0% for 2030 | |
| 2030 Capital Investment Plan | Reported | 78.00 Bil | 0 | Affirmed | Guidance: 78.00 Bil for 2030 | |||
Q1 2026 Earnings Reported 5/5/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2026 Operating EPS | Reported | 6.15 | 6.3 | 6.45 | 0 | Affirmed | Guidance: 6.3 for 2026 | |
| 2030 Operating Earnings CAGR | Reported | 0.09 | ||||||
| 2030 Capital Plan | Reported | 78.00 Bil | 8.3% | Raised | Guidance: 72.00 Bil for 2026 | |||
| 2030 Annual Rate-Base Growth | Reported | 11.0% | ||||||
Q4 2025 Earnings Reported 2/12/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2026 Operating Earnings | Reported | 6.15 | 6.3 | 6.45 | 0.0% | Affirmed | Guidance: 6.3 for 2026 | |
| 2026 Operating Earnings Growth Rate | Reported | 7.0% | 8.0% | 9.0% | ||||
| 2026 Capital Investment | Reported | 72.00 Bil | ||||||
| 2026 Incremental Investment Opportunities | Reported | 5.00 Bil | 6.50 Bil | 8.00 Bil | ||||
Insider Activity
Updated 10/21/2026| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Dixon, Kate | Controller, CAO | Direct | Sell | 9092026 | 125.00 | 2,000 | 250,000 | 1,982,000 | Form |
| 2 | Ulrich, Phillip R | Executive Vice President | Direct | Sell | 3022026 | 132.08 | 4,106 | 542,320 | 5,582,097 | Form |
| 3 | Ferneau, Kelly J | Executive Vice President | Direct | Sell | 2252026 | 131.46 | 1,351 | 177,602 | 2,025,799 | Form |
| 4 | Fowke, Benjamin G S Iii | Direct | Sell | 12152025 | 115.07 | 5,000 | 575,350 | 2,980,083 | Form | |
| 5 | Fowke, Benjamin G S Iii | Direct | Sell | 11172025 | 121.58 | 5,000 | 607,900 | 3,756,579 | Form |
| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Dixon, Kate | Controller, CAO | Direct | Sell | 9092026 | 125.00 | 2,000 | 250,000 | 1,982,000 | Form |
| 2 | Ulrich, Phillip R | Executive Vice President | Direct | Sell | 3022026 | 132.08 | 4,106 | 542,320 | 5,582,097 | Form |
| 3 | Ferneau, Kelly J | Executive Vice President | Direct | Sell | 2252026 | 131.46 | 1,351 | 177,602 | 2,025,799 | Form |
| 4 | Fowke, Benjamin G S Iii | Direct | Sell | 12152025 | 115.07 | 5,000 | 575,350 | 2,980,083 | Form | |
| 5 | Fowke, Benjamin G S Iii | Direct | Sell | 11172025 | 121.58 | 5,000 | 607,900 | 3,756,579 | Form | |
| 6 | Fowke, Benjamin G S Iii | Direct | Sell | 10142025 | 117.52 | 5,000 | 587,600 | 4,218,733 | Form | |
| 7 | Ferneau, Kelly J | Executive Vice President | Direct | Sell | 10032025 | 112.00 | 1,006 | 112,672 | 635,712 | Form |
Investor Activity (13F)
Updated Oct 31, 2026Active managers (13F portfolio over $250M, at least 3 holdings) with a position over $5M that is either over 10% of their portfolio or held in a concentrated book of 50 or fewer total positions. Index/ETF, sovereign, bank, community-bank and charitable/donor-advised filers are excluded.
AEP Trade Sentinel
Constructive
CONVICTION RATIONALE
AEP is capturing a historic surge in electricity demand, with 84 gigawatts of new load contractually secured through 2031. This underpins a new $100 billion investment plan and a projected 9% to 11% annual earnings growth rate. While the scale of this plan creates financing and execution hurdles, contracts are structured to mitigate risk, positioning the company for significant, visible growth.
STOCK ARCHETYPE
Regulated Utility & Infrastructure GrowthRevenue = (Regulated Rate Base * Authorized Return on Equity) + Pass-Through Costs + Market-Based Sales Growth in the regulated rate base through massive capital expenditures, particularly in high-return transmission assets, with timely and constructive cost recovery from regulators.
INVESTMENT THESIS
Evidence suggests AEP is successfully translating unprecedented data center demand into a highly visible, multi-year growth cycle.
- Incremental contracted load increased to 84 GW, up 15 GW in the third quarter alone.
- The five-year capital plan was expanded to $100 billion for 2027-2031.
- Company introduced a 9% to 11% annual operating EPS growth rate for 2027-2031.
- New take-or-pay agreements are expected to generate up to $21 billion in cost offsets for existing customers.
PRIMARY RISK
The sheer scale of the $100 billion capital program creates significant execution, regulatory, and financing risks that could overwhelm the growth opportunity and erode shareholder returns.
- The capital plan requires successfully navigating numerous state and federal rate cases for cost recovery.
- Trailing-twelve-month free cash flow is negative at $-8.3 billion due to heavy investment.
- The plan includes a $2.5 billion marketed equity issuance over the next two years.
- Accounts receivable grew 32.5% year-over-year, outpacing revenue growth of 13.7%.
| KPI | Status | Rationale |
|---|---|---|
| Incremental Contracted Load | 84 GW by 2031 - Accelerating | The pipeline of committed new customer demand has expanded dramatically and at an accelerating pace over the past year. The latest 15 GW increase in the third quarter was driven by the addition of the Piketon project and other new electric service agreements. |
| Five-Year Capital Plan & Rate Base CAGR | $100 billion for 2027-2031, supporting a 13%+ rate base CAGR. - Accelerating | |
| Rate Base CAGR | 13%+ (through 2031) | The compound annual growth rate of the company's rate base is a direct indicator of its potential for regulated earnings growth. A higher rate base CAGR supports a higher earnings growth rate. |
Growth Engine or Capital Trap?
BULL VIEW
The $100 billion plan is a de-risked response to 84 GW of secured demand, with take-or-pay contracts and favorable regulatory mechanisms ensuring profitable growth and a 13%+ rate base CAGR.
CORE TENSION
Can the highly visible 84 GW of contracted demand justify the execution risk of a $100B capital plan, which the market reacted to negatively?
PREVAILING SENTIMENT
The latest evidence favors the bull view. The contracted load is accelerating and management has a specific, dated financing and regulatory plan to support the investment.
BEAR VIEW
The unprecedented spending will lead to execution missteps, regulatory fatigue, and shareholder dilution, turning the promised growth into a low-return capital sink that strains the balance sheet.
| Timeline | Event & Metric To Watch |
|---|---|
Dec. 10, 2026 | Quarterly Dividend Payment Watch: A quarterly cash dividend of 97 cents per share is payable. |
November 2026 - Q1 2027 | Adverse Regulatory Rulings Watch: Final orders from the IURC and other commissions on pending dockets. Watch for delays or unfavorable cost recovery terms. |
November 2026 | Indiana Solar Project Ruling Watch: A final order is expected from the IURC for the Lake Trout Solar Project PSA. |
December 2026 | Indiana Gas Plant Acquisition Ruling Watch: A final order is expected from the IURC for the acquisition of the Sycamore Plant. |
Q4 2026 | Financing Execution Headwinds Watch: Announcement of the West Virginia securitization terms. Any news on equity offerings or debt issuances and the market's reception. |
the first quarter of 27 | Piketon Project Construction Start Watch: Construction is expected to begin on the Piketon transmission project. |
2/8/2027 | Negative Peer Read-Through Watch: Peer commentary on capital cost inflation, supply chain issues, or any change in the tone of data center demand. |
2/10/2027 | Company Earnings Report Watch: The company is scheduled to report its next earnings. |
| Date | Event | Stock Impact |
|---|---|---|
2026-10-28 | Q3 Earnings and Strategic Update Details: | -1.6% $130.30 -> $128.20 |
2026-10-20 | Quarterly Dividend Increased Details: The Board of Directors increased the regular quarterly cash dividend by 2 cents to 97 cents per share. | +2.1% $124.72 -> $127.39 |
2026-10-14 | Major Tech Partnerships Announced Details: Announced a plan to invest approximately $4 billion in a 702 MW fuel cell project for Google and a joint development agreement with Amazon and X-energy to explore a nuclear project. | -1.1% $125.65 -> $124.29 |
2026-08-17 | Activist Investor Trims Stake Details: Press reports indicated that activist investor Carl Icahn trimmed his stake in AEP during the second quarter of 2026. | +0.6% $125.60 -> $126.35 |
2026-07-30 | Q2 Earnings and Guidance Raise Details: Reported Q2 operating EPS and raised full-year 2026 guidance to $6.25-$6.55. Expanded new load additions to 69 GW and secured approximately 13 GW of gas-fired turbines. | -1.2% $128.42 -> $126.88 |
2026-05-05 | Q1 Earnings and Capex Increase Details: Reported Q1 operating EPS of $1.64, reaffirmed 2026 guidance, and increased the five-year capital plan to $78 billion. Incremental contracted load expanded to 69 GW. | -1.6% $132.68 -> $130.61 |
Position Sizing
5% - 7%
NORMAL POSITION
Sizing is volatility-based: AEP trades at roughly 17% annualized realized (three-month) volatility versus about 11% for the S&P 500 (1.6x the market). A 5% - 7% position keeps a single-name swing of that size within a diversified portfolio's risk budget.
Diversification Alternatives
DUK - Duke Energy
Large-Cap PeerAs a larger entity with revenue 1.4 times that of AEP, Duke Energy may offer a more diversified footprint and potentially a more moderate, less execution-intensive growth profile.
SO - Southern Company
Alternative Growth ProfileSouthern Company provides exposure to the same data center growth theme, but its reported 17 GW of contracted load suggests a different scale and pace of investment compared to AEP's 84 GW.
AEP is a regulated utility transforming into a high-growth infrastructure company, capitalizing on surging electricity demand from data centers with a massive, de-risked capital plan.
AEP is at the center of an unprecedented surge in electricity demand, driven by data centers and industrial growth in its 11-state territory. The company is leveraging its massive transmission network and generation expertise to capture this growth through a newly expanded $100 billion, five-year capital plan. This investment is largely de-risked by long-term, take-or-pay contracts with large customers and constructive regulatory frameworks, which also provide up to $21 billion in cost offsets for existing residential customers. This positions AEP for a sustained period of top-tier rate base and earnings growth.
News of further increases to the capital plan, additional large-load contracts being signed (especially in Texas), and continued constructive outcomes in state rate cases would confirm the growth thesis.
News of significant project delays or cost overruns, regulatory pushback or rate case denials, or a material slowdown in data center development in AEP's key territories would damage the thesis.
Short-term stock reactions to individual earnings reports, minor weather-related earnings volatility, or early-stage political rhetoric around data centers that does not translate into concrete regulatory action.
Repricing Catalyst
The October 2026 announcement of a significantly expanded $100 billion capital plan and an increased long-term operating EPS growth rate to 9-11%, driven by 84 GW of contracted large-load demand.
Vertically Integrated Utilities
$13.2B TTM (58% of Total)What It Is
This segment is engaged in the generation, transmission, and distribution of electricity for sale to retail and wholesale customers through assets owned by several AEP subsidiaries including APCo, I&M, and PSO.
Who Pays & How
Retail (residential, commercial, industrial) and wholesale customers within regulated service territories in states like Virginia, Indiana, and Oklahoma pay for bundled electricity service. They pay AEP because it holds the franchise or other rights to provide exclusive electric service in these areas.
Competition
Transmission and Distribution Utilities
$6.4B TTM (28% of Total)What It Is
This segment consists of the transmission and distribution of electricity for sale to retail and wholesale customers through assets owned by AEP Texas and OPCo (Ohio Power).
Who Pays & How
In Ohio, retail customers pay for transmission and distribution services. In Texas, Retail Electric Providers (REPs) who supply electricity to end-customers pay AEP Texas for the delivery of that power across its infrastructure.
Competition
Generation & Marketing
$3.1B TTM (14% of Total)What It Is
This segment focuses on a retail energy supply business (AEP Energy) providing electricity and natural gas to residential, commercial, and industrial customers in competitive markets, and a wholesale energy trading and marketing business.
Who Pays & How
Residential, commercial, and industrial customers in seven states and Washington D.C. pay for competitive electricity and/or natural gas supply. Wholesale market participants pay for energy and related transactions to manage supply and pricing risk.
Competition
Industry Resources
| Utilities Resources |
| Data.gov Energy Infrastructure |
| Data.gov Energy Resources |
| Utility Dive |
| Electric Utilities Resources |
| T&D World |
| Edison Electric Institute (EEI) |
| Smart Energy International |
External Quote Links
| Y Finance | Barrons |
| TradingView | Morningstar |
| SeekingAlpha | ValueLine |
| Motley Fool | Robinhood |
| CNBC | Etrade |
| MarketWatch | Unusual Whales |
| YCharts | Perplexity Finance |
| FinViz |
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