114.57 USD
-1.2 (-1.04%)
114.57 USD
0 (0%)
We assign a fundamental rating of 4 out of 10 to AEP. AEP was compared to 48 industry peers in the Electric Utilities industry. While AEP belongs to the best of the industry regarding profitability, there are concerns on its financial health. AEP is valied quite expensively at the moment, while it does show a decent growth rate. AEP also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year AEP was profitable.
In the past year AEP had a positive cash flow from operations.
In the past 5 years AEP has always been profitable.
Each year in the past 5 years AEP had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 3.32%, AEP is doing good in the industry, outperforming 70.83% of the companies in the same industry.
AEP has a better Return On Equity (12.03%) than 66.67% of its industry peers.
The Return On Invested Capital of AEP (4.13%) is comparable to the rest of the industry.
The Average Return On Invested Capital over the past 3 years for AEP is in line with the industry average of 4.97%.
The last Return On Invested Capital (4.13%) for AEP is above the 3 year average (3.55%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.32% | ||
| ROE | 12.03% | ||
| ROIC | 4.13% |
ROA(3y)2.54%
ROA(5y)2.64%
ROE(3y)9.79%
ROE(5y)10.22%
ROIC(3y)3.55%
ROIC(5y)3.47%
1.3 Margins
The Profit Margin of AEP (17.23%) is better than 87.50% of its industry peers.
AEP's Profit Margin has improved in the last couple of years.
AEP has a better Operating Margin (24.93%) than 68.75% of its industry peers.
AEP's Operating Margin has improved in the last couple of years.
AEP has a Gross Margin (68.45%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of AEP has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 24.93% | ||
| PM (TTM) | 17.23% | ||
| GM | 68.45% |
OM growth 3Y3.41%
OM growth 5Y5.01%
PM growth 3Y0.51%
PM growth 5Y4.04%
GM growth 3Y1.2%
GM growth 5Y-2.58%
2. Health
2.1 Basic Checks
AEP has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
AEP has more shares outstanding than it did 1 year ago.
The number of shares outstanding for AEP has been increased compared to 5 years ago.
The debt/assets ratio for AEP has been reduced compared to a year ago.
2.2 Solvency
AEP has an Altman-Z score of 0.98. This is a bad value and indicates that AEP is not financially healthy and even has some risk of bankruptcy.
AEP has a better Altman-Z score (0.98) than 62.50% of its industry peers.
A Debt/Equity ratio of 1.49 is on the high side and indicates that AEP has dependencies on debt financing.
AEP has a Debt to Equity ratio of 1.49. This is comparable to the rest of the industry: AEP outperforms 45.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.49 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.98 |
ROIC/WACC0.64
WACC6.49%
2.3 Liquidity
AEP has a Current Ratio of 0.69. This is a bad value and indicates that AEP is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of AEP (0.69) is worse than 79.17% of its industry peers.
AEP has a Quick Ratio of 0.69. This is a bad value and indicates that AEP is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of AEP (0.53) is worse than 77.08% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.69 | ||
| Quick Ratio | 0.53 |
3. Growth
3.1 Past
AEP shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.32%.
The Earnings Per Share has been growing slightly by 5.71% on average over the past years.
AEP shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.44%.
Measured over the past years, AEP shows a small growth in Revenue. The Revenue has been growing by 4.85% on average per year.
EPS 1Y (TTM)7.32%
EPS 3Y5.78%
EPS 5Y5.71%
EPS Q2Q%-2.7%
Revenue 1Y (TTM)8.44%
Revenue growth 3Y5.51%
Revenue growth 5Y4.85%
Sales Q2Q%11.3%
3.2 Future
Based on estimates for the next years, AEP will show a small growth in Earnings Per Share. The EPS will grow by 7.89% on average per year.
The Revenue is expected to grow by 7.00% on average over the next years.
EPS Next Y6.6%
EPS Next 2Y6.76%
EPS Next 3Y7.06%
EPS Next 5Y7.89%
Revenue Next Year5.46%
Revenue Next 2Y6.51%
Revenue Next 3Y6.39%
Revenue Next 5Y7%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 19.06 indicates a rather expensive valuation of AEP.
The rest of the industry has a similar Price/Earnings ratio as AEP.
Compared to an average S&P500 Price/Earnings ratio of 26.43, AEP is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 17.92, the valuation of AEP can be described as rather expensive.
AEP's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.66, AEP is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.06 | ||
| Fwd PE | 17.92 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, AEP is valued a bit more expensive than the industry average as 60.42% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.1 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of AEP may justify a higher PE ratio.
PEG (NY)2.89
PEG (5Y)3.34
EPS Next 2Y6.76%
EPS Next 3Y7.06%
5. Dividend
5.1 Amount
AEP has a Yearly Dividend Yield of 3.33%.
AEP's Dividend Yield is comparable with the industry average which is at 3.09.
AEP's Dividend Yield is rather good when compared to the S&P500 average which is at 1.87.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.33% |
5.2 History
The dividend of AEP has a limited annual growth rate of 5.62%.
AEP has paid a dividend for at least 10 years, which is a reliable track record.
AEP has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.62%
Div Incr Years15
Div Non Decr Years20
5.3 Sustainability
AEP pays out 54.46% of its income as dividend. This is a bit on the high side, but may be sustainable.
AEP's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP54.46%
EPS Next 2Y6.76%
EPS Next 3Y7.06%
114.57
-1.2 (-1.04%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners85.99%
Inst Owner Change-0.2%
Ins Owners0.02%
Ins Owner Change-0.11%
Market Cap61.19B
Revenue(TTM)21.26B
Net Income(TTM)3.66B
Analysts71.85
Price Target131.27 (14.58%)
Short Float %4.31%
Short Ratio6.53
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.33% |
Yearly Dividend3.6
Dividend Growth(5Y)5.62%
DP54.46%
Div Incr Years15
Div Non Decr Years20
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)4.92%
Min EPS beat(2)-1.41%
Max EPS beat(2)11.24%
EPS beat(4)2
Avg EPS beat(4)4.4%
Min EPS beat(4)-1.41%
Max EPS beat(4)11.24%
EPS beat(8)5
Avg EPS beat(8)2.09%
EPS beat(12)7
Avg EPS beat(12)1.92%
EPS beat(16)10
Avg EPS beat(16)1.91%
Revenue beat(2)2
Avg Revenue beat(2)2.56%
Min Revenue beat(2)1.47%
Max Revenue beat(2)3.65%
Revenue beat(4)3
Avg Revenue beat(4)1.14%
Min Revenue beat(4)-5.22%
Max Revenue beat(4)4.64%
Revenue beat(8)3
Avg Revenue beat(8)-1.72%
Revenue beat(12)4
Avg Revenue beat(12)1.1%
Revenue beat(16)8
Avg Revenue beat(16)3.12%
PT rev (1m)5.81%
PT rev (3m)12.35%
EPS NQ rev (1m)-0.49%
EPS NQ rev (3m)8.55%
EPS NY rev (1m)0.16%
EPS NY rev (3m)0.36%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.16%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-0.05%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.06 | ||
| Fwd PE | 17.92 | ||
| P/S | 2.88 | ||
| P/FCF | N/A | ||
| P/OCF | 8.92 | ||
| P/B | 2.01 | ||
| P/tB | 2.01 | ||
| EV/EBITDA | 12.1 |
EPS(TTM)6.01
EY5.25%
EPS(NY)6.39
Fwd EY5.58%
FCF(TTM)-3.25
FCFYN/A
OCF(TTM)12.84
OCFY11.21%
SpS39.8
BVpS57.01
TBVpS56.91
PEG (NY)2.89
PEG (5Y)3.34
Graham Number87.8
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.32% | ||
| ROE | 12.03% | ||
| ROCE | 5.29% | ||
| ROIC | 4.13% | ||
| ROICexc | 4.18% | ||
| ROICexgc | 4.18% | ||
| OM | 24.93% | ||
| PM (TTM) | 17.23% | ||
| GM | 68.45% | ||
| FCFM | N/A |
ROA(3y)2.54%
ROA(5y)2.64%
ROE(3y)9.79%
ROE(5y)10.22%
ROIC(3y)3.55%
ROIC(5y)3.47%
ROICexc(3y)3.57%
ROICexc(5y)3.49%
ROICexgc(3y)3.58%
ROICexgc(5y)3.5%
ROCE(3y)4.66%
ROCE(5y)4.55%
ROICexgc growth 3Y2.86%
ROICexgc growth 5Y3.59%
ROICexc growth 3Y2.86%
ROICexc growth 5Y3.6%
OM growth 3Y3.41%
OM growth 5Y5.01%
PM growth 3Y0.51%
PM growth 5Y4.04%
GM growth 3Y1.2%
GM growth 5Y-2.58%
F-Score6
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.49 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 5.16 | ||
| Cap/Depr | 245.73% | ||
| Cap/Sales | 40.43% | ||
| Interest Coverage | 2.78 | ||
| Cash Conversion | 77.96% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.69 | ||
| Quick Ratio | 0.53 | ||
| Altman-Z | 0.98 |
F-Score6
WACC6.49%
ROIC/WACC0.64
Cap/Depr(3y)223.56%
Cap/Depr(5y)219.34%
Cap/Sales(3y)37.81%
Cap/Sales(5y)38.02%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)7.32%
EPS 3Y5.78%
EPS 5Y5.71%
EPS Q2Q%-2.7%
EPS Next Y6.6%
EPS Next 2Y6.76%
EPS Next 3Y7.06%
EPS Next 5Y7.89%
Revenue 1Y (TTM)8.44%
Revenue growth 3Y5.51%
Revenue growth 5Y4.85%
Sales Q2Q%11.3%
Revenue Next Year5.46%
Revenue Next 2Y6.51%
Revenue Next 3Y6.39%
Revenue Next 5Y7%
EBIT growth 1Y31.19%
EBIT growth 3Y9.11%
EBIT growth 5Y10.1%
EBIT Next Year81.64%
EBIT Next 3Y30.39%
EBIT Next 5Y22.43%
FCF growth 1Y50.83%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y62.11%
OCF growth 3Y21.01%
OCF growth 5Y9.77%
AMERICAN ELECTRIC POWER / AEP FAQ
Can you provide the ChartMill fundamental rating for AMERICAN ELECTRIC POWER?
ChartMill assigns a fundamental rating of 4 / 10 to AEP.
What is the valuation status of AMERICAN ELECTRIC POWER (AEP) stock?
ChartMill assigns a valuation rating of 2 / 10 to AMERICAN ELECTRIC POWER (AEP). This can be considered as Overvalued.
Can you provide the profitability details for AMERICAN ELECTRIC POWER?
AMERICAN ELECTRIC POWER (AEP) has a profitability rating of 7 / 10.
How financially healthy is AMERICAN ELECTRIC POWER?
The financial health rating of AMERICAN ELECTRIC POWER (AEP) is 1 / 10.
What is the expected EPS growth for AMERICAN ELECTRIC POWER (AEP) stock?
The Earnings per Share (EPS) of AMERICAN ELECTRIC POWER (AEP) is expected to grow by 6.6% in the next year.