American Electric Power (AEP)
Utilities · $65.5B market cap · SEC CIK 0000004904
fundamentals score out of 100
Next reports on Oct 22, 2026, before the open, with analysts expecting $1.95 in earnings per share.
The case for AEP
- Generated $3.5B of free cash flow in FY2025, 16% of revenue.
- Revenue growing 10.6% year over year.
- Pays a 4.5% dividend while you wait.
- Moves less than the market (beta 0.47).
- Free-cash-flow yield of 5.3% is higher than 96% of Utilities companies.
The case against
- Long-term debt of $44.1B would take 6 years of operating cash flow to repay.
- Earnings per share fell 15.4%.
- Current liabilities exceed current assets (ratio 0.50).
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Utilities companies (momentum is judged against fixed thresholds only), and the five are blended by weight. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings, sales, assets and cash | 70 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 46 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 61 |
| Momentumhow the price has behaved lately | 47 |
| Stabilityhow violently it moves, what it owes and what it pays you | 52 |
- Each factor except momentum is half fixed thresholds, half rank among the 31 Utilities companies.
Key numbers
| Price / earnings | 20.8× |
|---|---|
| Price / book | 2.42× |
| Price / sales | 2.9× |
| Revenue growth (YoY) | +10.6% |
| EPS growth (YoY) | -15.4% |
| Gross margin | 42% |
| Operating margin | 24% |
| Net margin | 14% |
| Return on equity | 10% |
| Debt / equity | 1.64× |
| Current ratio | 0.50 |
| Dividend yield | 4.48% |
| Beta | 0.47 |
| 52-week range | $105.70 – $140.58 |
| Position in that range | 42% of the way up |
| 3-month return | -6.0% |
| 1-year return | +12.1% |
Five years of financials, as filed
Pulled from American Electric Power's XBRL filings on SEC EDGAR. Italic rows are derived from the rows above.
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Revenue | $21.7B | $20.0B | $19.5B | $19.4B | $16.8B |
| Operating income | $5.3B | $4.3B | $3.6B | $3.5B | $3.4B |
| Operating cash flow | $6.9B | $6.8B | $5.0B | $5.3B | $3.8B |
| Capital expenditure | $3.5B | $399M | $155M | — | — |
| Total assets | $114B | $103B | $96.7B | $93.4B | $87.7B |
| Total liabilities | $82.2B | $76.1B | $71.4B | $69.2B | $64.9B |
| Shareholder equity | $31.1B | $26.9B | $25.2B | $23.9B | $22.4B |
| Cash | $197M | $203M | $330M | $509M | $403M |
| Long-term debt | $44.1B | $39.3B | $37.7B | $34.3B | $32.2B |
| Free cash flow | $3.5B | $6.4B | $4.9B | — | — |
| Operating margin | 24.5% | 21.6% | 18.3% | 18.0% | 20.3% |
| Diluted shares | 537M | 531M | 520M | 513M | 502M |
Share count is up 7.1% over 4 years. Mild issuance.
What American Electric Power says it does
Overview and Description of Major Subsidiaries AEP was incorporated under the laws of the State of New York in 1906 and reorganized in 1925. It is a public utility holding company that directly owns all of the outstanding common stock of the public utility subsidiaries identified below. The service areas of AEP’s public utility subsidiaries cover portions of the states of Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia and West Virginia. Transmission networks are interconnected with extensive distribution facilities in the territories served. The public utility subsidiaries of AEP have traditionally provided electric service, consisting of generation, transmission and distribution, on an integrated basis to their retail customers. Restructuring laws in Michigan, Ohio and the ERCOT area of Texas have caused AEP public utility subsidiaries in those states to unbundle previously integrated…
Risk factors AEP lists in its 10-K
- AEP may not be able to recover the costs of substantial planned investment in capital improvements and additions. (Applies to all Registrants)
- The business and capital investment plans of AEP depend, in part, on the continued growth and viability of data centers and large load customers interconnecting with the AEP System. (Applies to all Registrants)
- The business and capital investment plans of AEP are subject to execution risks. (Applies to all Registrants)
- Regulated electric revenues and earnings are dependent on federal and state regulations that may limit AEP’s ability to recover costs and other amounts. (Applies to all Registrants)
- Regulated electric revenues and earnings are subject to prudency review. (Applies to all Registrants)
- Regulatory bodies may not allow recovery of costs incurred on a timely basis. (Applies to all Registrants)
- AEP is subject to negative publicity. (Applies to all Registrants)
- AEP’s transmission investment strategy and execution are dependent on federal and state regulatory policy and implementation by RTOs. (Applies to all Registrants)
- Certain elements of AEP’s transmission formula rates have been challenged, which could result in lowered rates and/or refunds of amounts previously collected. (Applies to all Registrants other than AEP Texas)
- Changes in technology and regulatory policies may lower the value of electric utility facilities and franchises. (Applies to all Registrants)
- AEP is exposed to nuclear generation risk. (Applies to AEP and I&M)
- AEP subsidiaries are exposed to risks through participation in the market and transmission structures in various regional power markets that are beyond their control. (Applies to all Registrants)
- AEP could be subject to higher costs and/or penalties related to mandatory reliability standards. (Applies to all Registrants)
- AEP’s financial performance may be adversely affected if AEP is unable to successfully operate facilities or perform certain corporate functions. (Applies to all Registrants)