On Friday, American Electric Power Company, Inc. (NASDAQ:AEP) reported fourth quarter revenue of $4.70 billion, missing the consensus of $4.88 billion.
Total energy distribution rose 4.0% year over year (Y/Y) in the Vertically Integrated Utilities segment and rose 10.3% Y/Y in the Transmission & Distribution Utilities segment.
Commercial load rose by 10.6% in 2024, led by economic expansion within the company’s service area.
Adjusted operating earnings rose to $660.1 million in the quarter from $646.9 million a year ago.
Adjusted operating earnings from Vertically Integrated Utilities rose to $275.5 million from $237.8 million the prior year, and AEP Transmission Holdco grew to $166.3 million from $159.3 million in the prior year's quarter.
Adjusted EPS of $1.24 beat the consensus of $1.22.
FY25 Outlook: American Electric Power reaffirmed FY25 adjusted EPS of $5.75 – $5.95 vs consensus of $5.88.
The company continues to see a long-term growth rate outlook of 6% to 8%.
Bill Fehrman, AEP president and chief executive officer, said, “We anticipate 8-9% annual total retail load growth from 2025-2027 and ultimately expect to serve more than 20 gigawatts of new load by the end of the decade.”
”Our $54 billion, five-year capital plan that we announced in the fall supports this opportunity as we build infrastructure that meets the needs of our customers, communities and the states that we serve. Further, as we continue to review the full scope of our infrastructure needs, we are evaluating $10 billion of potential incremental investment across our service territory and regional transmission grids,” he added.
AEP Executive Vice President and Chief Financial Officer Trevor Mihalik said, “The $2.82 billion minority equity interest transaction we announced in early January for our Ohio and Indiana Michigan Transmission Companies gives us financial flexibility to redeploy the proceeds and support economic growth in our states, while maintaining our commitment to a strong balance sheet.”
”This was a creative and effective way to finance the growth we are seeing, equivalent to issuing common stock at $170 per share, a significant premium to our current share price. We recently submitted the necessary regulatory filing and expect to close on the transaction in the second half of the year,” Mihalik added.
Investors can gain exposure to the stock via Listed Funds Trust TrueShares Eagle Global Renewable Energy Income ETF (NYSE:RNWZ) and Themes ETF Trust Themes Uranium & Nuclear ETF (BATS:URAN).
Price Action: AEP shares were up 0.46% to $102.35 on Wednesday.
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