AEP (AEP) Up 0.4% Since Last Earnings Report: Can It Continue?

Core Viewpoint - American Electric Power (AEP) reported a positive earnings performance for Q2 2024, with adjusted EPS beating estimates and revenues showing year-over-year growth, although some segments experienced declines in earnings [1][2][3]. Financial Performance - Adjusted EPS for Q2 2024 was $1.25, exceeding the Zacks Consensus Estimate of $1.23 by 1.6% and improving 10.6% from $1.13 in the same quarter last year [1]. - Operating revenues reached $4.73 billion, a 5.6% increase from $4.48 billion in the previous year, while GAAP revenues were reported at $4.58 billion, up 4.7% year-over-year [2]. Segmental Performance - Vertically Integrated Utility Operations saw adjusted earnings decline to $244.8 million from $260.4 million year-over-year [3]. - Transmission & Distribution Utilities reported adjusted earnings of $215.3 million, an increase from $156.5 million in the prior year [3]. - AEP Transmission Holdco generated adjusted earnings of $208.9 million, up from $196.5 million [3]. - Generation and Marketing adjusted earnings fell to $61 million from $66.1 million [3]. - The "All Other" segment reported a loss of $68 million, an improvement from a loss of $97.3 million in the previous year [3]. Operational Highlights - Electricity sales volume from Vertically Integrated Utilities increased by 2% year-over-year, while Transmission & Distribution Utilities improved by 12% [4]. - Total expenses for Q2 2024 were $3.62 billion, a 2.6% increase from the previous year, with interest expenses amounting to $465.6 million, up 1.2% [4]. Guidance and Estimates - AEP reiterated its 2024 operating earnings guidance, expecting earnings in the range of $5.53-$5.73 per share, with the Zacks Consensus Estimate at $5.59 per share [5]. - Estimates for AEP have trended upward over the past month, indicating a positive outlook [6][7]. Industry Comparison - AEP is part of the Zacks Utility - Electric Power industry, where CMS Energy reported revenues of $1.61 billion for the last quarter, reflecting a year-over-year increase of 3.3% [8]. - CMS Energy's EPS for the same period was $0.66, down from $0.75 a year ago, with expected earnings of $0.78 per share for the current quarter, indicating a 27.9% year-over-year change [8].