# American Electric Power (AEP.US)

Canonical: https://gigainvestors.com/s/AEP

Analysis as of: 2026-10-16T07:26:16.133Z. Financial observations: FY1996–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: $124.29 per share; close as of 2026-10-15.

Estimated value: low $57.24 per share, central $68.83 per share, high $80.13 per share. Buy at or below the central value $68.83 per share. Valuation as of 2026-10-16T07:26:16.133Z; scenarios are not confidence intervals.

Expected annual return: 6.8% at the stated quote. About 6.8% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: pass

- 3 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 3

- Years with a net loss: 0

- Operating margin variation: 0.16×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.22×

- FY2018: 0.17×

- FY2019: 0.18×

- FY2020: 0.20×

- FY2021: 0.20×

- FY2022: 0.18×

- FY2023: 0.21×

- FY2024: 0.24×

- FY2025: 0.24×

- LTM to Jun 2026: 0.28×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 5.6%

- ROIC, second-lowest year: 5.3%

- Typical minus recent gross margin: -3.5 pp

- Typical gross margin (annual median): 28.3%

- Recent gross margin (lower of latest and 3-year median): 31.8%

- Years with nonpositive capital: 0

- Capital spending / revenue: 38.2%

- ROIC including acquisitions, ten-year median: -0.7%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 8.7%

- FY2017: 5.4%

- FY2018: 5.8%

- FY2019: 5.5%

- FY2020: 5.4%

- FY2021: 5.3%

- FY2022: 5.2%

- FY2023: 5.9%

- FY2024: 6.6%

- FY2025: 6.3%

### economics: fail

- owner earnings cash conversion below threshold

- incremental invested capital return below threshold

- Owner earnings / net income, 5-yr: 0.79×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $11B

- Net income, five-year total: $14B

- Return on incremental invested capital: 10.4%

- Working capital / revenue, annual change: 0.2 pp

- Working capital / revenue, change between three-year averages: 2.3 pp

- Working capital / revenue, final three-year average: 8.4%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.00×

- FY2022: 1.00×

- FY2023: -0.83×

- FY2024: 0.26×

- FY2025: 1.94×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 5.8% vs 6.3%

- Per-share earnings: 3.88 to 5.58 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 0.9%

- Ordinary dilution, 5-year annual growth: 1.6%

- Market cap gain: $31B

- Cumulative retained earnings: $7.5B

- Diluted shares, 10-year annual growth: 0.9%

- Diluted shares, 5-year annual growth: 1.6%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 4.6%

- Per-share value change: $1.70

- Per-share value, starting three-year median: $3.88

- Per-share value, ending three-year median: $5.58

- Buyback history: 0 years

- Debt-funded buybacks: No

- Acquisition spending: $51M

- Cumulative net income, 10 years: $22B

- ROIC, first three-year median: 5.8%

- ROIC, last three-year median: 6.3%

Chart: Earnings per share; fiscal year observations.

- FY2016: $1.24

- FY2017: $3.88

- FY2018: $3.90

- FY2019: $3.88

- FY2020: $4.42

- FY2021: $4.96

- FY2022: $4.49

- FY2023: $4.24

- FY2024: $5.58

- FY2025: $6.66

### accounting: pass

- Sloan accruals: -2.9%

- Receivables to sales index (DSRI): 1.00×

- Restructuring years, last five: 2

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.94×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.00×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -6.2%

- FY2017: -3.6%

- FY2018: -4.8%

- FY2019: -3.1%

- FY2020: -2.0%

- FY2021: -1.5%

- FY2022: -3.2%

- FY2023: -2.9%

- FY2024: -3.7%

- FY2025: -2.9%

## Holders

- [David Hoeft](https://gigainvestors.com/DAC): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [David Katz](https://gigainvestors.com/MAVFX): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Carl Icahn](https://gigainvestors.com/ic): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Price needs cash profits to grow 9.7% a year for ten years · "AEP Reports Second-Quarter 2026 Earnings, Raises Full-Year Guidance" (finance.yahoo.com, Jul 2026) · sales +3.4%

Story as of 2026-10-16T09:58:14.935Z; price observation 2026-10-15.

Price needs cash profits to grow 9.7% a year for ten years

- 2025-07-30: AEP rallies after posting Q2 beat, unveiling $70B five-year capital plan ([seekingalpha.com](https://seekingalpha.com/news/4474583-aep-rallies-after-posting-q2-beat-unveiling-70b-five-year-capital-plan?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

- 2025-10-29: AEP Reports Third-Quarter 2025 Operating Earnings, Updated Capital Plan Drives New Long-Term Growth Rate ([finance.yahoo.com](https://finance.yahoo.com/news/aep-reports-third-quarter-2025-105700034.html))

- 2026-01-20: AI Needs Power Now—Bloom Energy and American Electric Power Deliver ([finance.yahoo.com](https://finance.yahoo.com/news/ai-needs-power-now-bloom-173200526.html))

- 2026-02-14: American Electric Power Weighs Data Center Boom Against Rising Capital Demands ([finance.yahoo.com](https://finance.yahoo.com/news/american-electric-power-weighs-data-042528047.html))

- 2026-03-02: American Electric Power Targets AI Data Center Growth With Expanded Capex ([finance.yahoo.com](https://finance.yahoo.com/news/american-electric-power-targets-ai-091010143.html))

- 2026-05-06: AEP eyes exit from PJM, SPP over slow generation interconnection ([finance.yahoo.com](https://finance.yahoo.com/sectors/energy/articles/aep-eyes-exit-pjm-spp-083119338.html))

### Sales · FY2025–2026

sales +3.4%; source https://www.sec.gov/Archives/edgar/data/4904/000000490426000013/aep-20251231.htm; observed 2026-02-12.

- FY2017: $15B 

- FY2018: $16B 

- FY2019: $16B 

- FY2020: $15B 

- FY2021: $17B 

- FY2022: $19B 

- FY2023: $19B 

- FY2024: $20B 

- FY2025: $22B 

- FY2026: $23B 

### Gross margin · FY2025

gross margin 31.8%; source https://www.sec.gov/Archives/edgar/data/4904/000000490426000013/aep-20251231.htm; observed 2026-02-12.

- FY2016: 27.1% 

- FY2017: 28.5% 

- FY2018: 23.8% 

- FY2019: 25.5% 

- FY2020: 28.7% 

- FY2021: 28.1% 

- FY2022: 25.2% 

- FY2023: 29.0% 

- FY2024: 31.9% 

- FY2025: 31.8% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in utilities regulated electric; annual sales are USD 21.8 billion.

- Source: https://www.sec.gov/Archives/edgar/data/4904/000000490426000013/aep-20251231.htm (filed 2026-02-12); FY2025: revenue 21783000000; grossProfit 6930000000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); AEP.US: American Electric Power Company, Inc., an electric public utility holding company, engages in the generation, transmission, and distribution of electricity for sale to retail and wholesale customers in the United States. It operates through Vertically Integrated Utilities, Transmission and Distribution Utilities, AEP Transmission Holdco, and Generation & Marketing segments. The company generates electricity using coal and lignite, nuclear, natural gas, renewable, hydro, solar, wind, and other energy sources; owns, operates, maintains, and invests in transmission infrastructure; and engages in the retail supply, and wholesale energy trading and marketing businesses. It operates approximately 252,000 circuit miles of distribution lines; 38,000 circuit miles of transmission lines; and 25,000 MWs of regulated owned generating capacity. American Electric Power Company, Inc. was incorporated in 1906 and is headquartered in Columbus, Ohio.

### Why customers stay

Margins ranged from 29% to 31.9% during 2023–25; it earns 5.6% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-12); FY2023: grossProfit / revenue = 29%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-12); FY2024: grossProfit / revenue = 31.9%.

- Source: https://www.sec.gov/Archives/edgar/data/4904/000000490426000013/aep-20251231.htm (filed 2026-02-12); FY2025: grossProfit / revenue = 31.8%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-12); 10-year return on capital observations [[2016,0.08735883200303482],[2017,0.05416375056770665],[2018,0.058080574039246755],[2019,0.05482182805203906],[2020,0.0538669622831953],[2021,0.05337367066118969],[2022,0.05241018913794674],[2023,0.05907978969845882],[2024,0.06590526818531055],[2025,0.06334012008524431]]; median 0.056451201045642906. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 10 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-12); FY2018: growth capex 2356709314.155078; upkeep 4000290685.844922; owner earnings 323909314.15507793. Growth capex / owner earnings = 7.275830645076039.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-12); FY2021: growth capex 2717700000; upkeep 3046400000; owner earnings 2488100000. Growth capex / owner earnings = 1.0922792492263174.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-12); FY2022: growth capex 3486700000; upkeep 3285700000; owner earnings 2307200000. Growth capex / owner earnings = 1.5112257281553398.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-12); FY2024: growth capex 2175987249.019512; upkeep 5594612750.980488; owner earnings 765287249.0195122. Growth capex / owner earnings = 2.8433601262890402.

- Source: https://www.sec.gov/Archives/edgar/data/4904/000000490426000013/aep-20251231.htm (filed 2026-02-12); FY2025: growth capex 0; upkeep 130000000; owner earnings 6939000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-12); Dividend observations: [[2016,1116800000],[2017,1191900000],[2018,1251100000],[2019,1350000000],[2020,1424900000],[2021,1519500000],[2022,1645200000],[2023,1760400000],[2024,1903900000],[2025,2008000000]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own <0.1% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); AEP.US SharesStats.PercentInsiders = 0.034 percentage points; cache date 2026-10-16.

### What could break it

"Regulated electric revenues and earnings are dependent on federal and state regulations" (SEC filing, Feb 2026)

- Source: https://www.sec.gov/Archives/edgar/data/4904/000000490426000013/aep-20251231.htm (filed 2026-02-12); Regulated electric revenues and earnings are dependent on federal and state regulations

### What the price says

The price assumes cash profits grow 9.7% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-12); Ten-year compound average after fade. Initial solved rate 0.12685703292619166. Price 124.29; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share -0.8117012702541889 → FY2025 12.91053931196426. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $64.84 per share

- 2016-11: $59.05 per share

- 2016-12: $62.96 per share

- 2017-01: $64.06 per share

- 2017-02: $66.97 per share

- 2017-03: $67.13 per share

- 2017-04: $67.83 per share

- 2017-05: $71.78 per share

- 2017-06: $69.47 per share

- 2017-07: $70.54 per share

- 2017-08: $73.63 per share

- 2017-09: $70.24 per share

- 2017-10: $74.41 per share

- 2017-11: $77.63 per share

- 2017-12: $73.57 per share

- 2018-01: $68.78 per share

- 2018-02: $65.58 per share

- 2018-03: $68.59 per share

- 2018-04: $69.98 per share

- 2018-05: $67.95 per share

- 2018-06: $69.25 per share

- 2018-07: $71.14 per share

- 2018-08: $71.73 per share

- 2018-09: $70.88 per share

- 2018-10: $73.36 per share

- 2018-11: $77.74 per share

- 2018-12: $74.74 per share

- 2019-01: $79.12 per share

- 2019-02: $81.15 per share

- 2019-03: $83.75 per share

- 2019-04: $85.55 per share

- 2019-05: $86.12 per share

- 2019-06: $88.01 per share

- 2019-07: $87.81 per share

- 2019-08: $91.15 per share

- 2019-09: $93.69 per share

- 2019-10: $94.39 per share

- 2019-11: $91.35 per share

- 2019-12: $94.51 per share

- 2020-01: $104.22 per share

- 2020-02: $89.26 per share

- 2020-03: $79.98 per share

- 2020-04: $83.11 per share

- 2020-05: $85.25 per share

- 2020-06: $79.64 per share

- 2020-07: $86.88 per share

- 2020-08: $78.83 per share

- 2020-09: $81.73 per share

- 2020-10: $89.93 per share

- 2020-11: $84.89 per share

- 2020-12: $83.27 per share

- 2021-01: $80.91 per share

- 2021-02: $74.85 per share

- 2021-03: $84.70 per share

- 2021-04: $88.71 per share

- 2021-05: $86.00 per share

- 2021-06: $84.59 per share

- 2021-07: $88.12 per share

- 2021-08: $89.57 per share

- 2021-09: $81.18 per share

- 2021-10: $84.71 per share

- 2021-11: $81.05 per share

- 2021-12: $88.97 per share

- 2022-01: $90.40 per share

- 2022-02: $90.65 per share

- 2022-03: $99.77 per share

- 2022-04: $99.11 per share

- 2022-05: $102.03 per share

- 2022-06: $95.94 per share

- 2022-07: $98.56 per share

- 2022-08: $100.20 per share

- 2022-09: $86.45 per share

- 2022-10: $87.92 per share

- 2022-11: $96.80 per share

- 2022-12: $94.95 per share

- 2023-01: $93.96 per share

- 2023-02: $87.97 per share

- 2023-03: $90.99 per share

- 2023-04: $92.42 per share

- 2023-05: $83.12 per share

- 2023-06: $84.20 per share

- 2023-07: $84.74 per share

- 2023-08: $78.40 per share

- 2023-09: $75.22 per share

- 2023-10: $75.54 per share

- 2023-11: $79.55 per share

- 2023-12: $81.22 per share

- 2024-01: $78.14 per share

- 2024-02: $85.19 per share

- 2024-03: $86.10 per share

- 2024-04: $86.03 per share

- 2024-05: $90.25 per share

- 2024-06: $87.74 per share

- 2024-07: $98.12 per share

- 2024-08: $100.28 per share

- 2024-09: $102.60 per share

- 2024-10: $98.75 per share

- 2024-11: $99.86 per share

- 2024-12: $92.23 per share

- 2025-01: $98.36 per share

- 2025-02: $106.05 per share

- 2025-03: $109.27 per share

- 2025-04: $108.34 per share

- 2025-05: $103.49 per share

- 2025-06: $103.76 per share

- 2025-07: $113.14 per share

- 2025-08: $111.02 per share

- 2025-09: $112.50 per share

- 2025-10: $120.26 per share

- 2025-11: $123.77 per share

- 2025-12: $115.31 per share

- 2026-01: $119.78 per share

- 2026-02: $133.82 per share

- 2026-03: $131.08 per share

- 2026-04: $137.11 per share

- 2026-05: $126.67 per share

- 2026-06: $136.81 per share

- 2026-07: $127.85 per share

- 2026-08: $122.43 per share

- 2026-09: $118.64 per share

- 2026-10: $125.65 per share

## Annual estimated value (USD per share)

- FY2016: low $1.55 per share, central $1.72 per share, high $1.93 per share

- FY2022: low $9.32 per share, central $11.12 per share, high $12.86 per share

- FY2024: low $15.78 per share, central $17.95 per share, high $20.84 per share

- FY2025: low $55.90 per share, central $67.25 per share, high $78.32 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:31:51.681Z where newer inputs omit a numeric field or fiscal period.

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/4904/000000490426000013/aep-20251231.htm); period 2025-12-31, filed 2026-02-12.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.

## Reported holder observations

- [David Hoeft](https://gigainvestors.com/DAC): 8,674,355 AEP shares; USD 1,186,739,000 reported position value; 0.62% of portfolio; reduce; quarter 2026 Q2.
- [David Katz](https://gigainvestors.com/MAVFX): 179,543 AEP shares; USD 21,301,000 reported position value; 1.76% of portfolio; add; quarter 2026 Q3.
- [Carl Icahn](https://gigainvestors.com/ic): 434,710 AEP shares; USD 59,473,000 reported position value; 0.72% of portfolio; reduce; quarter 2026 Q2.

# AEP — American Electric Power

Held by 1 investor · USD 21,301,000 total · 2026 Q3 · reported price USD 118.64 (split-adjusted).
Page: https://gigainvestors.com/s/AEP

## Holders (2026 Q3)

| Investor | Value | % of their portfolio | This quarter |
|---|---:|---:|---|
| David Katz (https://gigainvestors.com/MAVFX) | USD 21,301,000 | 1.8% | add +16.22% |

## Total held by quarter

- 2021 Q4: USD 2,475,923 · 1 holder · USD 88.95
- 2022 Q1: USD 11,264,233 · 1 holder · USD 99.77
- 2022 Q2: USD 10,864,150 · 1 holder · USD 95.94
- 2022 Q3: USD 9,010,597 · 1 holder · USD 86.45
- 2022 Q4: USD 11,325,541 · 1 holder · USD 94.95
- 2023 Q1: USD 12,101,488 · 1 holder · USD 90.99
- 2023 Q2: USD 11,678,456 · 1 holder · USD 84.20
- 2023 Q3: USD 16,171,096 · 1 holder · USD 75.22
- 2023 Q4: USD 111,167,276 · 2 holders · USD 81.22
- 2024 Q1: USD 1,102,338,213 · 3 holders · USD 86.10
- 2024 Q2: USD 1,164,099,137 · 3 holders · USD 87.74
- 2024 Q3: USD 1,335,419,541 · 3 holders · USD 102.60
- 2024 Q4: USD 1,199,924,659 · 3 holders · USD 92.23
- 2025 Q1: USD 1,338,169,264 · 3 holders · USD 109.27
- 2025 Q2: USD 1,138,097,785 · 3 holders · USD 103.76
- 2025 Q3: USD 1,228,492,350 · 3 holders · USD 112.50
- 2025 Q4: USD 1,237,636,182 · 3 holders · USD 115.31
- 2026 Q1: USD 1,323,109,330 · 3 holders · USD 131.08
- 2026 Q2: USD 1,267,347,503 · 3 holders · USD 136.81
- 2026 Q3: USD 21,301,000 · 1 holder · USD 118.64