3 models fit American Electric Power Company Inc. Common Stock and they disagree: 0 of 3 land within 15% of the average.
Two or more of our models back this value.
Near fair value(i)
Valued as a utility: Dividend discount, P/E comparison, EV/EBITDA comparison, and Discounted cash flow.
ACCE opinionAmerican Electric Power Company Inc. Common Stock (AEP)
Fair value (3 models)
$146
ACCE price target
$129
Rating
Fairly valued
Horizon
12 months
Fair value published on 21 Oct 2026, 11:06 CEST; previously $174 since 16 Oct 2026, 00:00 CEST.
ACCE price target published on 18 Oct 2026, 00:00 CEST; previously $151 since 8 May 2026, 00:00 CEST.
Rating published on 21 Oct 2026, 11:06 CEST.
Price used: $130 at the close on 23 Oct 2026, 22:00 CEST.
Models: Discounted cash flow, P/E comparison, and Dividend discount.
Fair value: the average of the applicable valuation models (discounted cash flow, multiples, residual income, dividend discount, shareholder yield), each run on the latest financial statements and the market price shown. Opinion columns (fair value, target, rating) are shown apart from the data. Full methodology: acceinvestments.com/data/how-we-value-stocks
Conflicts of interest: The author holds no personal position in this security. General statement
Produced by ACCE Investments (acceinvestments.com)
Data
Price vs fair value
10.9% below
+12.2% to fair value
ACCE score
53
out of 100
Analysts
61% buy
23 covering
P/E
22.6x
forward 17.2x
1-year return
+11.6%
Dividend yield
2.97%
American Electric Power Company Inc. Common Stock in four questions
Plain answers, details below
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Overview
ACCE thesis
American Electric Power owns and operates one of the largest transmission networks in the US and runs regulated distribution and generation utilities across roughly a dozen states, earning returns on the capital it deploys under state-approved rate cases. The structural case rests on that regulated rate base: as AEP spends on grid hardening and transmission to serve data center and industrial load growth, it can recover that capital with an authorized return, which gives the earnings stream a visible path. Revenue grew 7.0% over the last year, and the 17.2x forward P/E sits below the 21.5x trailing multiple, implying the market expects earnings to rise. Against that, ROE of 10.1% is modest for the sector and the 23.3% operating margin reflects a capital-heavy model where regulatory outcomes, not pricing power, drive returns. At a $67.7B market cap with no index membership, the name is worth a closer look mainly to test whether the rate base growth is converting into per-share earnings at an acceptable cost of equity.