Electric utility company American Electric Power Co. Inc. (AEP) is due to release its fourth-quarter results before the market opens Thursday, with analysts projecting earnings of $0.46 per share, on revenues of $3.54 billion.
American Electric, one of the largest electric utilities in the U.S., provides electricity to more than 5 million customers in 11 states. American Electric owns more than 38,000 megawatts of generating capacity in the U.S, and also owns the nation's largest electricity transmission system, a nearly 39,000-mile network that includes more 765-kilovolt extra-high voltage transmission lines than all other U.S. transmission systems combined.
Like other utility companies, American Electric has also been hit hard by weak demand for power amid the severe economic crisis. The slowdown in residential and commercial real estate growth has also impacted the utility companies' steady profits.
According to the Energy Information Administration, total U.S. electricity consumption fell 3.6% in 2009, but is estimated to grow by 1.9% in 2010, reflecting projected increase in residential and commercial sector electricity sales as assumed summer air conditioning use this year returns to normal after the mild summer in 2009. Improving economic conditions would help drive growth in electricity sales to the industrial sector over the next two years, with projected consumption of electricity in this sector growing by 0.9% in 2010 and 2.0% 2011.
Earlier in November, American Electric said it expects 2009 ongoing earnings of $2.90 - $3.05 per share, raising its low-end of the prior outlook in the range of $2.75 - $3.05 per share. For the year 2010, the company anticipates ongoing earnings to range between $2.80 and $3.20 per share.
Michael Morris, AEP's chairman, president and chief executive officer, "Our earnings projections for 2010 are driven by new rate recovery activity underway in several jurisdictions across our service territories, an expected increase in off-system sales of electricity as that market improves after a weak year in 2009, and a general increase in retail load."
For the third quarter, the company reported higher profit totaling $443 million or $0.93 per share, compared to $374 million or $0.93 per share in the prior-year quarter, helped by rate increases and cost cutting, partially offset by weak industrial demand amid the economic downturn, mild weather as well as a quarterly revenue drop. Revenues for the quarter dropped to $3.5 billion from $4.2 billion in the previous year.
Among other players in the field, Duke Energy Corp. (DUK) is scheduled to publish fourth-quarter results on February 12, with analysts projecting earnings of $0.25 per share on revenues of $3.44 billion, while Entergy Corp. (ETR), another peer, is due to report fourth-quarter results on February 2, with Wall Street analysts looking for earnings of $1.55 per share, on revenues of $3.71 billion.
Most recently, Credit Suisse reiterated American Electric at Outperform with $40, up from $33 price target.
American Electric shares, which have been trading between $24.00 and $36.86 in the past 52 weeks, closed Wednesday's trading session at $35.53, down 8 cents or 0.22%.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.