COLUMBUS, Ohio - American Electric Power (NASDAQ:AEP) reported fourth-quarter earnings that fell slightly short of analyst expectations, with an adjusted EPS of $1.23 compared to the projected $1.26. Despite this, the company's stock climbed 3.27% due to its optimistic guidance for the fiscal year 2024.
For the quarter, AEP posted revenue of $4.6 billion, missing the consensus estimate of $5.12 billion. However, the company's future outlook appears to be a driving factor for investor confidence. AEP has reaffirmed its FY2024 adjusted EPS guidance range of $5.53 to $5.73, which hovers around the analyst consensus of $5.60, signaling a positive trajectory.
Benjamin G.S. Fowke III, interim chief executive officer and president, commented on the results, saying, "Our team delivered 2023 operating earnings results within our narrowed guidance range as we navigated a dynamic environment." He emphasized the company's strategic initiatives, including investments in the energy system to benefit customers and a disciplined approach to economic development.
The company's strategic investments and cost management have led to a 7.8% increase in commercial load and a 1.6% increase in industrial load for the year. Fowke also highlighted the company's $43 billion capital plan, focusing on transmission and distribution investments to ensure reliable, affordable power.
AEP's earnings for the fourth quarter of 2023 were $336 million or $0.64 per share on a GAAP basis, compared with $384 million or $0.75 per share in the same quarter last year. The adjusted earnings, which exclude special items, were $647 million or $1.23 per share, up from $540 million or $1.05 per share in the fourth quarter of 2022.
The company is progressing with its strategy to de-risk the business, expecting to conclude the sales process for its AEP Energy retail and AEP OnSite Partners distributed resources businesses by the end of the second quarter. Additionally, the sale of its 50% share in the New Mexico Renewable Development is anticipated to be completed by the end of February for $115 million.
In conclusion, American Electric Power's shares have responded positively to the company's forward-looking guidance, despite a slight miss in fourth-quarter earnings and revenue compared to analyst estimates. The company's strategic focus and operational achievements have set the stage for continued growth in the upcoming fiscal year.
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