Columbus, Ohio-based American Electric Power Company, Inc. (AEP) is an electric public utility holding company that generates, transmits, and distributes electricity for sale to retail and wholesale customers. Valued at a market cap of $54.2 billion, the company generates electricity using coal and lignite, natural gas, renewable, nuclear, hydro, solar, wind, and other energy sources and also engages in wholesale energy trading and marketing business. 

Companies worth $10 billion or more are typically classified as “large-cap stocks,” and AEP fits the label perfectly, with its market cap exceeding this threshold, underscoring its size, influence, and dominance within the utilities - regulated electric industry. The company is known for its diversified power generation portfolio, strong regulated utility base, and strategic infrastructure investments. Its core strength lies in its regulated operations, which provide stable and predictable earnings through long-term rate-based returns. Serving more than 5.5 million customers across 11 states, AEP operates an extensive network of transmission and distribution lines. 

This utility company has dipped 8.2% from its 52-week high of $110.48, reached on Apr. 4. Shares of AEP have declined 3.1% over the past three months, lagging behind the S&P 500 Index’s ($SPX) 4.1% rise during the same time frame.

However, in the longer term, AEP has surged 14.9% over the past 52 weeks, outperforming SPX’s 12.3% uptick over the same time frame. Moreover, on a YTD basis, shares of AEP are up 10%, compared to SPX’s 2.1% gain. 

To confirm its recent bearish trend, AEP has been trading below its 50-day moving average since early May. However, it has remained above its 200-day moving average over the past year, with minor fluctuations. 

AEP delivered a strong Q1 performance on May 6, and its shares surged marginally in the following trading session. The company’s revenue improved 8.7% year-over-year to $5.5 billion and topped the consensus estimates by 2.2%. Moreover, its operating earnings of $1.54 per share climbed 21.3% from the year-ago quarter and surpassed the analyst estimates by 10.8%. The solid results were supported by operating earnings growth across all of AEP’s reportable segments. Buoyed by this strong performance, the company reaffirmed its fiscal 2025 operating EPS guidance of $5.75 to $5.95, and maintained its long-term projected growth rate of 6% to 8%.

AEP has outperformed its rival, Duke Energy Corporation (DUK), which gained 12.5% over the past 52 weeks and 7.2% on a YTD basis. 

Despite AEP’s recent underperformance, analysts remain moderately optimistic about its prospects. The stock has a consensus rating of "Moderate Buy” from the 19 analysts covering it, and the mean price target of $110.43 suggests an 8.9% premium to its current price levels.