Fact based stock research
American Electric Power (NYSE:AEP)
US0255371017
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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
American Electric Power stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 68 (better than 68% compared with investment alternatives), American Electric Power (Electric Utilities, USA) shares have above-average financial characteristics compared with similar stocks. Shares of American Electric Power are a good value (attractively priced) with a consolidated Value Rank of 55 (better than 55% of alternatives), show above-average growth (Growth Rank of 95) but are riskily financed (Safety Rank of 12), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 68, is a buy recommendation based on American Electric Power's financial characteristics. As the company American Electric Power's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 55) and above-average growth (Obermatt Growth Rank of 95), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 12) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | USA |
| Industry | Electric Utilities |
| Index | Low Emissions, Diversity USA, Nuclear, Recycling, S&P 500 |
| Size class | XX-Large |
This stock has achievements: Top 10 Stock.
19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: American Electric Power
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 33 |
|
55 |
|
57 |
|
55 |
|
| GROWTH | ||||||||
| GROWTH | 27 |
|
33 |
|
63 |
|
95 |
|
| SAFETY | ||||||||
| SAFETY | 9 |
|
22 |
|
22 |
|
12 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
69 |
|
43 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
41 |
|
36 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 68 (better than 68% compared with investment alternatives), American Electric Power (Electric Utilities, USA) shares have above-average financial characteristics compared with similar stocks. Shares of American Electric Power are a good value (attractively priced) with a consolidated Value Rank of 55 (better than 55% of alternatives), show above-average growth (Growth Rank of 95) but are riskily financed (Safety Rank of 12), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 68, is a buy recommendation based on American Electric Power's financial characteristics. As the company American Electric Power's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 55) and above-average growth (Obermatt Growth Rank of 95), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 12) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 33 |
|
55 |
|
57 |
|
55 |
|
| GROWTH | ||||||||
| GROWTH | 27 |
|
33 |
|
63 |
|
95 |
|
| SAFETY | ||||||||
| SAFETY | 9 |
|
22 |
|
22 |
|
12 |
|
| COMBINED | ||||||||
| COMBINED | 6 |
|
24 |
|
46 |
|
68 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 55 (better than 55% compared with alternatives), American Electric Power shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for American Electric Power. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 64 which means that the stock price compared with what market professionals expect for future profits is lower than for 64% of comparable companies, indicating a good value concerning American Electric Power's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 50, and for Dividend Yield with a Dividend Yield Rank of 61. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 52% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 48). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 55, is a buy recommendation based on American Electric Power's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that American Electric Power has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing American Electric Power shares. 9. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 36 |
|
46 |
|
40 |
|
48 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 58 |
|
65 |
|
66 |
|
64 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 38 |
|
41 |
|
51 |
|
50 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 54 |
|
61 |
|
61 |
|
61 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 33 |
|
55 |
|
57 |
|
55 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 95 (better than 95% compared with alternatives) for 2024, American Electric Power shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all four indicators above average for American Electric Power. Sales Growth has a value of 60, which means that, currently, professionals expect the company to grow more than 60% of its competitors. The same is valid for Profit Growth with a value of 82 and for Capital Growth with 96. In addition, Stock Returns had an above-average rank value of 55, which means they have been higher than 55% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 95, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, American Electric Power exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 39 |
|
61 |
|
73 |
|
60 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 1 |
|
48 |
|
54 |
|
82 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
8 |
|
74 |
|
96 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 21 |
|
51 |
|
33 |
|
55 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 27 |
|
33 |
|
63 |
|
95 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 12 (better than 12% compared with alternatives), the company American Electric Power has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of American Electric Power is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for American Electric Power. Liquidity is at 27, meaning that the company generates less profit to service its debt than 73% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 26, meaning the company has an above-average debt-to-equity ratio. It has more debt than 74% of its competitors. Finally, Refinancing is at a rank of 26 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 74% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 12 (worse than 88% compared with alternatives), American Electric Power has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing. Investors should look at Obermatt’s Value, Growth, and Sentiment Ranks to confirm a very positive outlook or be careful with investing in stocks of American Electric Power because it may suffer significantly in case of future difficulties. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 24 |
|
18 |
|
18 |
|
26 |
|
| REFINANCING | ||||||||
| REFINANCING | 26 |
|
28 |
|
24 |
|
26 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 24 |
|
57 |
|
63 |
|
27 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 9 |
|
22 |
|
22 |
|
12 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
63 |
|
64 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
50 |
|
50 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
87 |
|
69 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
30 |
|
18 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
69 |
|
43 |
|
new |
|
Free stock analysis by the purely fact based Obermatt Method for American Electric Power from December 19, 2024.
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