Analyst Ross Fowler from Bank of America Securities has reaffirmed his Buy rating for American Electric Power (AEP), maintaining a price target of $117.00 per share. This decision is based on several encouraging indicators regarding the company’s financial health and future prospects.
American Electric Power recently announced its first-quarter operating earnings per share (EPS) at $1.54, exceeding both Bank of America’s estimate and consensus expectations of $1.39. This increase is attributed to favorable weather conditions, rate relief, and enhanced returns from regulated utility operations, all of which align with the company’s growth assumptions for 2025.
AEP has also reiterated its full-year guidance for EPS, predicting a range between $5.75 and $5.95, with expectations for long-term EPS growth of 6% to 8%. The company completed a significant equity issuance of $2.3 billion, adequately covering its financial requirements through 2029, and it has a robust capital expenditure plan amounting to $54 billion for the same duration. Although AEP has experienced a slight decline in retail load growth this quarter, there are projections for substantial growth particularly in commercial sales in the upcoming years, which buttresses the optimistic outlook for the company.
In a similar vein, Morgan Stanley echoed this supportive sentiment in a report released on April 23, also maintaining a Buy rating on AEP with a target of $114.00.
Ross Fowler has established himself as a reliable analyst within the Utilities sector, achieving a 4-star rating, an average return of 3.6%, and a success rate of nearly 60%. His analysis focuses on several utilities including Northwestern and Consolidated Edison, further underscoring the robust characteristics of AEP.
The positive outlook regarding AEP reflects a broader confidence in the utilities sector, as companies adapt to market changes while progressing toward long-term growth goals. This resilience and strategic planning could inspire investor confidence amidst market fluctuations.