American Electric downgraded to Sell from Neutral at Ladenburg

Ladenburg downgraded American Electric Power to Sell from Neutral with a price target of $73, down from $75.50. The analyst cites valuation for the downgrade. Since September 2023, the stock has outperformed the Philadelphia Utility index by 7.8% without any visible improvement in the company’s regulatory outlook, the analyst tells investors in a research note. The firm says American Electric’s recent negative regulatory decisions include a FERC ordered refund relating to its accounting for ADIT and fuel cost disallowances mandated by the West Virginia Commission and under consideration by the Kentucky Commission. Given “significant regulatory push-back,” Ladenburg continues to believe that American Electric should trade at a 5% discount to the utility group.