AES (AES) AI Stock Analysis

• Market Cap: $8.69B
• Dividend Yield: 5.68%
• Average Volume (3M): 15.48M
• Price to Earnings (P/E): 6.7
• Beta (1Y): 0.91
• Revenue Growth: -3.22%
• EPS Growth: 141.11%
• Country: US
• Employees: 9,100
• Sector: Utilities
• Sector Strength: 83
• Industry: Diversified Utilities
• EPS (TTM): 0.27
• Shares Outstanding: 711,922,800
• 10 Day Avg. Volume: 16,769,562
• 30 Day Avg. Volume: 15,476,426
• PEG Ratio: -0.28
• Price to Book (P/B): 2.28
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -2.27
• Enterprise Value/Market Cap: 4.23
• Enterprise Value/Revenue: 1.21
• Enterprise Value/Gross Profit: 17.21
• Enterprise Value/Ebitda: 4.53
• 1Y Price Target: $13.89
• Price Target Upside: 13.76% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

AES Corporation has a moderate score of 55. While there are strengths in profitability and strategic growth in renewables, significant financial challenges such as high leverage and negative cash flow weigh heavily. Technical indicators reflect bearish sentiment, but the low valuation and positive earnings call outlook offer some upside potential.

Positive Factors

Asset Sales

The $450M monetization of a 17.5% stake in its captive insurer, AGIC, was a surprising and creative move that helps de-risk its 2025 asset sale target.

Cost Management

Management came with a thoughtful, credible plan to manage a challenging set of near-term circumstances, boosting cash flow and EBITDA by cutting costs, prioritizing higher margin projects, and keeping some coal plants online for longer.

Financial Performance

Management reaffirmed all of financial targets for '25 and '27.

Negative Factors

Credit Metrics

Leverage metrics are still tracking close to AES's 4.5x threshold to preserve its investment-grade rating.

Investor Sentiment

Investors are increasingly focused on simple, defensive opportunities, making it a difficult path forward for AES.

Renewable Energy

Renewable PPA bookings of 443 MW came in below expectations.

AES Business Overview & Revenue Model

Company Description

AES Corporation is a global energy company headquartered in Arlington, Virginia. The company operates in the utilities sector, focusing on the generation and distribution of electrical power. AES is involved in a variety of energy solutions, including thermal and renewable energy sources like solar, wind, and hydroelectric power. The company aims to accelerate the future of energy by delivering greener, smarter energy solutions to its customers across several countries worldwide.

How the Company Makes Money

AES Corporation makes money primarily through the generation and sale of electricity. The company's key revenue streams include its regulated utilities and the sale of power through long-term contracts, power purchase agreements (PPAs), and wholesale markets. AES operates power plants and sells electricity to residential, commercial, and industrial customers. The company also generates revenue from renewable energy projects, including wind, solar, and battery storage, which are often supported by government incentives and contracts with utility companies. Significant partnerships with other energy companies and investments in energy infrastructure assets also contribute to AES's earnings by enhancing its market reach and operational efficiency.

AES Financial Statement Overview

Summary

AES shows mixed financial performance with notable strengths in profitability and ROE improvement. However, declining revenue, high leverage, and negative free cash flow present significant concerns. The company needs to manage its capital expenditures and leverage to ensure sustainable growth and stability.

Income Statement

The company's revenue has shown a declining trend recently, with a 3.08% decrease from 2023 to 2024. Gross profit margin is high at 100% for 2024, indicating effective cost management relative to revenue, but this is likely due to misclassification of data. The net profit margin improved significantly from 1.97% in 2023 to 6.92% in 2024, showcasing improved profitability. However, the EBIT and EBITDA margins have fallen, pointing to operational challenges.

Balance Sheet

The debt-to-equity ratio is high at 1.70 in 2024, indicating significant leverage, which can pose financial risks. The equity ratio is relatively stable at 34.23%, suggesting a moderate reliance on equity financing. Return on equity improved to 23.30% in 2024, demonstrating effective use of equity to generate profits, though it fluctuates due to varying net income.

Cash Flow

The company experienced negative free cash flow, worsening from -$469M in 2023 to -$464M in 2024, indicating substantial capital expenditures surpassing operating cash flow. The operating cash flow to net income ratio improved to 3.24 in 2024, suggesting better cash generation relative to net income. However, the cash flow situation remains challenging with high capital expenditure needs.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
12.12B	12.28B	12.67B	12.62B	11.14B	9.66B
	Gross Profit
2.13B	2.31B	2.50B	2.55B	2.71B	2.69B
	EBIT
1.84B	2.03B	2.25B	2.35B	2.57B	2.53B
	EBITDA
2.76B	3.67B	2.53B	3.40B	903.00M	3.60B
	Net Income Common Stockholders
1.22B	1.68B	249.00M	-546.00M	-409.00M	46.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.82B	1.60B	1.82B	2.10B	1.18B	1.42B
	Total Assets
48.62B	47.41B	44.80B	38.36B	32.96B	34.60B
	Total Debt
30.58B	29.02B	26.88B	23.50B	18.70B	19.88B
	Net Debt
28.82B	27.49B	25.45B	22.12B	17.76B	18.79B
	Total Liabilities
40.89B	38.76B	37.35B	33.86B	28.40B	29.88B
	Stockholders Equity
3.47B	3.64B	2.49B	2.44B	2.80B	2.63B
Cash Flow		Free Cash Flow
-3.49B	-4.64B	-4.69B	-1.84B	-214.00M	855.00M
	Operating Cash Flow
3.01B	2.75B	3.03B	2.71B	1.90B	2.75B
	Investing Cash Flow
-6.60B	-7.70B	-8.19B	-5.84B	-3.05B	-2.29B
	Financing Cash Flow
3.67B	4.96B	5.41B	3.76B	797.00M	-78.00M

AES Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 12.21
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AES, the sentiment is Positive. The current price of 12.21 is above the 20-day moving average (MA) of 10.76, above the 50-day MA of 11.36, and below the 200-day MA of 13.63, indicating a neutral trend. The MACD of 0.36 indicates Negative momentum. The RSI at 65.14 is Neutral, neither overbought nor oversold. The STOCH value of 89.16 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AES.

AES Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CIG	82 Outperform	$6.00B	4.14	26.38%	15.72%	-4.14%	13.02%
ELP	79 Outperform	$6.37B	12.43	9.22%	4.93%	-7.02%	17.33%
ELPC	77 Outperform	$6.37B	11.46	9.22%	4.86%	-7.02%	17.33%
SRE	74 Outperform	$50.61B	17.08	9.76%	3.23%	-0.39%	0.75%
Sector *	63 Neutral	$8.53B	10.18	4.66%	4.38%	3.77%	-12.97%
AES	55 Neutral	$8.69B	6.67	29.79%	5.68%	-3.22%	141.11%
BIP	54 Neutral	$21.44B	2,867.59	0.47%	5.00%	12.40%	-108.27%

AES Corporate Events

AES Approves 2025 Equity and Incentive Plan

On May 9, 2025, AES Corporation held its Annual Meeting of Stockholders, where several key proposals were approved, including the 2025 Equity and Incentive Compensation Plan. This plan authorizes the issuance of 14,000,000 shares of common stock and includes various performance and incentive awards for employees and directors, aiming to align their interests with company growth and shareholder value. Additionally, the meeting saw the election of eleven directors and the ratification of Ernst & Young LLP as the independent auditor for fiscal year 2025.

Spark’s Take on AES Stock

According to Spark, TipRanks’ AI Analyst, AES is a Neutral.

AES scores a moderate 52, reflecting a balance of strengths and challenges. Profitability and strategic growth in renewables are significant positives, but high leverage, negative cash flow, and bearish technical indicators weigh on the stock. The appealing valuation and positive earnings call outlook provide some upside potential.

To see Spark’s full report on AES stock, click here.

AES Reports Q1 2025 Financial Results with Net Loss

On May 1, 2025, AES Corporation announced its financial results for the first quarter of 2025, reporting a net loss of $73 million compared to a net income of $278 million in the same quarter of 2024. Despite the decrease in net income, AES reaffirmed its 2025 guidance and long-term growth targets, highlighting strategic accomplishments such as completing 643 MW of energy storage and solar projects, signing new PPAs, and achieving asset sale proceeds targets. The company also noted higher contributions from its Utilities and Renewables SBUs, offset by lower contributions from the Energy Infrastructure SBU due to prior year revenue factors.

Spark’s Take on AES Stock

According to Spark, TipRanks’ AI Analyst, AES is a Neutral.

AES receives a moderate score of 52. Despite strengths in profitability and strategic growth in renewables, significant financial challenges such as high leverage and negative cash flow weigh on its performance. Technical indicators reflect bearish sentiment, while valuation remains appealing. The earnings call provides a positive outlook, balancing the risks.

To see Spark’s full report on AES stock, click here.

AES Reports Strong 2024 Financial Results and Growth Outlook

On February 28, 2025, AES Corporation announced its financial results for the year ending December 31, 2024, highlighting significant achievements in strategic and financial goals. The company reported a net income of $698 million, a substantial increase from the previous year’s loss, driven by contributions from renewables projects and favorable currency gains. AES achieved strategic milestones by signing 6.8 GW of new contracts, including 4.4 GW of renewables under long-term PPAs, and completed 3.0 GW of renewable projects. The company also initiated guidance for 2025, expecting continued growth in renewables and reaffirming long-term growth targets. AES’s strategic focus on clean energy and efficiency positions it well to meet growing demands from AI data centers and manufacturing plants, while its de-risked growth plan through 2027 ensures stability and continued operational optimization.