American Electric Power Company, Inc. (AEP) DCF Valuation
A discounted-cash-flow model values American Electric Power Company, Inc. (AEP) at about $289.40 (analyst consensus (FMP)). Today's price of $127.76 sits below that range — by these conservative assumptions it screens as potentially undervalued.
Reverse DCF: at today's $127.76, the market is pricing in roughly +20.2%/yr free-cash-flow growth over the next decade (at a 10% required return) — versus its actual 5-year FCF CAGR of +38.5%. The price assumes a slowdown from its track record — a potential value signal if growth holds.
Current Price
$127.76
Fair-Value Range
$289.40
Market-Implied Growth
+20.2%/yr
vs +38.5% 5Y actual
AEP DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Illustrative model — not investment advice. Defaults to a conservative base case; the analyst (FMP) DCF, where available, is shown as a reference below.
Base inputs: FCF $2.4B · 0.54B shares · net debt $49.3B
Estimated Fair Value
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These assumptions imply no positive equity value — try a higher growth or lower discount rate.
About American Electric Power Company, Inc.
American Electric Power Company, Inc. (AEP) operates as a prominent electric utility holding company, with its core business encompassing the generation, transmission, and delivery of electricity. Serving both retail and wholesale clients across the United States, AEP organizes its extensive operations into several key segments: Vertically Integrated Utilities, Transmission and Distribution Utilities, AEP Transmission Holdco, and Generation & Marketing. The firm produces its electrical power from a diverse portfolio of energy sources, including coal, lignite, natural gas, nuclear, hydroelectric, solar, and wind power, alongside other emerging technologies. Beyond direct consumer sales, AEP also functions as a major wholesale electricity supplier, providing power to other utility companies, rural electric cooperatives, municipalities, and various other participants within the energy market. Incorporated in 1906, the company's corporate headquarters are situated in Columbus, Ohio.
- Sector
- Utilities
- Industry
- Regulated Electric
- CEO
- William J. Fehrman