BMO Capital analyst James Thalacker maintained a Buy rating on American Electric Power yesterday and set a price target of $127.00.
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James Thalacker has given his Buy rating due to a combination of factors that highlight American Electric Power’s promising growth trajectory and strategic investments. The company is set to unveil a refreshed 5-year capital plan, which anticipates a significant increase in capital expenditure to over $70 billion, marking a 30% rise from the current plan. This substantial investment is expected to be allocated primarily towards transmission and generation, which are crucial for supporting load growth and enhancing the company’s rate base growth.
Additionally, AEP’s management is expected to narrow its 2025 operating earnings guidance and initiate 2026 guidance, which suggests a healthy year-over-year EPS growth. The company’s focus on supply decarbonization and transmission investments is likely to contribute to a premium valuation over time. With an improving credit profile and a manageable equity financing strategy, AEP presents an attractive relative-value opportunity, making it a compelling choice for investors seeking long-term growth.
In another report released yesterday, Bank of America Securities also reiterated a Buy rating on the stock with a $131.00 price target.