AES

AES

Fundamental data last updated:April 13, 2026

company profile

SECTOR

Utilities

industry

Utilities - Diversified

Exchange

NYSE

County of HQ

United States

Next Earnings Date

05/07/26

Business Summary

AES is a diversified power generation and utility operator that develops, owns, and operates electricity generation and distribution assets. It generates cash by producing and selling electricity under long-term contracts and regulated rate structures, which create predictable revenue streams but require heavy upfront capital investment. Its moat is rooted in infrastructure scale, regulatory licenses, and long-term power purchase agreements that create high barriers to entry. However, the durability of that moat depends on disciplined capital allocation and balance sheet strength, as utilities live and die by financing costs and regulatory returns.

VALUATION

P/E

11

Market Cap ($M USD)

$10,261

Forward P/E

6

PEG

3.1

PRICE TO SALES

0.8

PRICE TO BOOK

2.5

EV / EBITDA

13.1

5-Year Average P/E

DIVIDEND

Yield

4.90%

Annual Payout

$0.70

Payout Ratio

55.90%

Consecutive Years of Dividend Growth

10+

5-Year Dividend Growth Rate

3.20%

Financial Health & Profitability

Earnings Per Share

$1.31

Next Year EPS Growth Estimate

$2.39

Next Year Revenue Growth Estimate

0.90%

Return on Equity (ROE)

22.20%

Operating Margin

16.10%

Debt-to-Equity

7.4

Piotroski F-Score

5

Altman Z-Score

0.5

Return on Invested Capital (ROIC)

5.40%%

Current Ratio

0.8

Quick Ratio

Gainseekers Quantitative Analysis

Summary

At 11x earnings and just 6x forward earnings, the market is clearly discounting AES as a stressed utility rather than a stable compounder. The low Forward P/E signals expectations of either earnings volatility or structural risk, and the 3.1 PEG Forward suggests growth is not especially cheap relative to its trajectory. The real red flag is the Altman Z-Score of 0.5, which implies material balance sheet stress risk, especially when paired with a 0.8 current ratio. This is not a “safe utility” multiple — it’s a leveraged asset play priced for fragility, and the market may be embedding solvency risk rather than simply slow growth.

AI Exposure / Tech Reliance

As a diversified utility, AES operates in a capital-intensive, regulated environment that will benefit from rising electricity demand driven by AI and data center expansion. Utilities are core infrastructure for AI scaling, but returns are constrained by regulation and capital structure. The company’s ability to modernize grids and generation assets will determine whether it converts AI-driven demand into durable ROIC expansion above its current 5.40%.

The Bull Case

A value or GARP investor could argue that 11x earnings and 0.8x sales represent a classic deep-value entry in a defensive sector with a 7.4 yield. The 22.20% operating margin shows the core business throws off meaningful operating cash before financing costs, and a Piotroski F-Score of 5 signals middling but not distressed operational quality. Despite balance sheet strain, ROIC at 5.40% in a regulated utility context is not catastrophic and could expand if capital is deployed more efficiently. With only 3.20% short interest, the market skepticism is present but not extreme, leaving room for rerating if earnings stabilize and the forward multiple of 6 proves justified.

The Bear Case

The bear case is straightforward: a Debt/Equity ratio of 16.10% combined with a 0.8 current ratio and an Altman Z-Score of 0.5 screams financial vulnerability. A PEG Forward of 3.1 indicates that even at a 6x forward multiple, growth-adjusted valuation is not compelling. Return on Equity of just 0.90% is shockingly low for a capital-intensive business and suggests shareholder capital is being poorly converted into profits. Add in a payout ratio of $0.70 alongside a 7.4 yield and you have a structure that may be stretching to maintain income appeal while balance sheet flexibility erodes.

Market Sentiment & Smart Money

Short Interest %

3.10%

Analyst Consensus

3

Average Analyst Price Target

$15.38

Institutional Ownership %

87.70%

1-Year Beta

1.01

Insider Buying % (6 Mo)

0.50%%

Distance to 52-Week High

81.50%%

Distance to 52-Week Low

152.10%%