Columbus, Ohio-based American Electric Power Company, Inc. (AEP) is an electric public utility company that generates, transmits, and distributes electricity to retail and wholesale customers. It is valued at a market cap of $70.3 billion.
Companies valued at $10 billion or more are typically classified as “large-cap stocks,” and AEP fits the label perfectly, with its market cap exceeding this threshold, underscoring its size, influence, and dominance within the utilities – regulated electric industry. The company’s primary strength lies in its massive, highly stable regulated utility asset base and its position as the operator of the nation’s largest electricity transmission system.
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This utility company is currently trading 7.4% below its 52-week high of $139.44, reached on May 5. Shares of AEP have declined 2.2% over the past three months, outperforming the State Street Utilities Select Sector SPDR ETF’s (XLU) 5.4% downtick during the same time frame.
Moreover, in the longer term, AEP has increased 26.9% over the past 52 weeks, outpacing XLU’s 9.7% uptick over the same time period. On a YTD basis, shares of AEP are up 12%, compared to XLU’s 3.9% gain.
To confirm its recent bearish trend, AEP has been trading below its 50-day moving average since early May. However, it has remained above its 200-day moving average over the past year.
AEP saw its stock rise 1.8% on May 5 following its strong Q1 earnings release that beat expectations on both lines. The utility company generated $6 billion in revenue, outperforming the Wall Street consensus estimate of $5.7 billion. This top-line momentum carried over to profitability, with AEP reporting an adjusted EPS of $1.64, which comfortably surpassed the analyst forecast of $1.55. Looking ahead, management expects its full-year adjusted EPS to land between $6.15 and $6.45.
AEP has outperformed its rival, Dominion Energy, Inc.’s (D) 19.5% uptick over the past 52 weeks. However, it has lagged D’s 14.2% YTD rise.
Looking at AEP’s recent outperformance, analysts remain moderately optimistic about its prospects. The stock has a consensus rating of “Moderate Buy” from the 24 analysts covering it, and the mean price target of $142.76 suggests a 10.5% premium to its current price levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com