AEP vs. NRG: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at AEP and NRG, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Overview
AEP’s market capitalization of 55.48 billion USD is substantially larger than NRG’s 30.97 billion USD, indicating a significant difference in their market valuations.
NRG carries a higher beta at 1.14, indicating it’s more sensitive to market moves, while AEP (beta: 0.41) exhibits greater stability.
| Symbol | AEP | NRG |
|---|---|---|
| Company Name | American Electric Power Company, Inc. | NRG Energy, Inc. |
| Country | US | US |
| Sector | Utilities | Utilities |
| Industry | Regulated Electric | Independent Power Producers |
| CEO | William J. Fehrman | Lawrence Stephen Coben |
| Price | 103.86 USD | 158.39 USD |
| Market Cap | 55.48 billion USD | 30.97 billion USD |
| Beta | 0.41 | 1.14 |
| Exchange | NASDAQ | NYSE |
| IPO Date | January 2, 1962 | December 2, 2003 |
| ADR | No | No |
Historical Performance
This chart compares the performance of AEP and NRG by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period.
Data is adjusted for dividends and splits.
Profitability
Return on Equity
AEP
10.33%
Regulated Electric Industry
- Max
- 18.07%
- Q3
- 12.49%
- Median
- 10.00%
- Q1
- 8.48%
- Min
- 5.02%
AEP’s Return on Equity of 10.33% is on par with the norm for the Regulated Electric industry, indicating its profitability relative to shareholder equity is typical for the sector.
NRG
47.87%
Independent Power Producers Industry
- Max
- 47.87%
- Q3
- 44.92%
- Median
- 37.16%
- Q1
- 23.52%
- Min
- 2.99%
In the upper quartile for the Independent Power Producers industry, NRG’s Return on Equity of 47.87% signals a highly effective use of shareholder capital to drive profitability compared to most of its peers.
Return on Invested Capital
AEP
4.16%
Regulated Electric Industry
- Max
- 5.26%
- Q3
- 4.57%
- Median
- 3.97%
- Q1
- 3.33%
- Min
- 1.92%
AEP’s Return on Invested Capital of 4.16% is in line with the norm for the Regulated Electric industry, reflecting a standard level of efficiency in generating profits from its capital base.
NRG
12.59%
Independent Power Producers Industry
- Max
- 12.59%
- Q3
- 7.91%
- Median
- 1.68%
- Q1
- 1.19%
- Min
- -2.93%
In the upper quartile for the Independent Power Producers industry, NRG’s Return on Invested Capital of 12.59% signifies a highly effective use of its capital to generate profits when compared to its peers.
Net Profit Margin
AEP
13.71%
Regulated Electric Industry
- Max
- 22.24%
- Q3
- 15.98%
- Median
- 13.10%
- Q1
- 11.03%
- Min
- 3.79%
AEP’s Net Profit Margin of 13.71% is aligned with the median group of its peers in the Regulated Electric industry. This indicates its ability to convert revenue into profit is typical for the sector.
NRG
4.66%
Independent Power Producers Industry
- Max
- 33.58%
- Q3
- 32.41%
- Median
- 13.40%
- Q1
- 3.33%
- Min
- -15.14%
NRG’s Net Profit Margin of 4.66% is aligned with the median group of its peers in the Independent Power Producers industry. This indicates its ability to convert revenue into profit is typical for the sector.
Operating Profit Margin
AEP
21.90%
Regulated Electric Industry
- Max
- 31.57%
- Q3
- 25.65%
- Median
- 21.93%
- Q1
- 17.87%
- Min
- 8.99%
AEP’s Operating Profit Margin of 21.90% is around the midpoint for the Regulated Electric industry, indicating that its efficiency in managing core business operations is typical for the sector.
NRG
9.17%
Independent Power Producers Industry
- Max
- 21.41%
- Q3
- 17.04%
- Median
- 9.17%
- Q1
- 6.05%
- Min
- 5.60%
NRG’s Operating Profit Margin of 9.17% is around the midpoint for the Independent Power Producers industry, indicating that its efficiency in managing core business operations is typical for the sector.
Profitability at a Glance
| Symbol | AEP | NRG |
|---|---|---|
| Return on Equity (TTM) | 10.33% | 47.87% |
| Return on Assets (TTM) | 2.65% | 5.46% |
| Return on Invested Capital (TTM) | 4.16% | 12.59% |
| Net Profit Margin (TTM) | 13.71% | 4.66% |
| Operating Profit Margin (TTM) | 21.90% | 9.17% |
| Gross Profit Margin (TTM) | 62.60% | 25.68% |
Financial Strength
Current Ratio
AEP
0.42
Regulated Electric Industry
- Max
- 1.48
- Q3
- 1.06
- Median
- 0.86
- Q1
- 0.73
- Min
- 0.28
AEP’s Current Ratio of 0.42 falls into the lower quartile for the Regulated Electric industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.
NRG
1.06
Independent Power Producers Industry
- Max
- 1.85
- Q3
- 1.84
- Median
- 1.62
- Q1
- 0.96
- Min
- 0.84
NRG’s Current Ratio of 1.06 aligns with the median group of the Independent Power Producers industry, indicating that its short-term liquidity is in line with its sector peers.
Debt-to-Equity Ratio
AEP
1.72
Regulated Electric Industry
- Max
- 2.38
- Q3
- 1.97
- Median
- 1.65
- Q1
- 1.28
- Min
- 0.27
AEP’s Debt-to-Equity Ratio of 1.72 is typical for the Regulated Electric industry, indicating its use of leverage is in line with the sector norm. This suggests a balanced approach to its capital structure.
NRG
3.96
Independent Power Producers Industry
- Max
- 3.96
- Q3
- 3.42
- Median
- 2.61
- Q1
- 1.23
- Min
- 0.64
NRG’s leverage is in the upper quartile of the Independent Power Producers industry, with a Debt-to-Equity Ratio of 3.96. While this approach can boost equity growth, it also exposes the company to greater financial vulnerability.
Interest Coverage Ratio
AEP
2.30
Regulated Electric Industry
- Max
- 3.07
- Q3
- 2.63
- Median
- 2.41
- Q1
- 2.30
- Min
- 1.87
In the lower quartile for the Regulated Electric industry, AEP’s Interest Coverage Ratio of 2.30 indicates a tighter cushion for servicing debt, suggesting less financial flexibility than many of its competitors.
NRG
4.38
Independent Power Producers Industry
- Max
- 4.38
- Q3
- 3.24
- Median
- 1.20
- Q1
- 0.44
- Min
- -1.77
NRG’s Interest Coverage Ratio of 4.38 is in the upper quartile for the Independent Power Producers industry, signifying a strong and healthy capacity to meet its interest payments from operating profits.
Financial Strength at a Glance
| Symbol | AEP | NRG |
|---|---|---|
| Current Ratio (TTM) | 0.42 | 1.06 |
| Quick Ratio (TTM) | 0.31 | 1.02 |
| Debt-to-Equity Ratio (TTM) | 1.72 | 3.96 |
| Debt-to-Asset Ratio (TTM) | 0.45 | 0.44 |
| Net Debt-to-EBITDA Ratio (TTM) | 6.42 | 2.78 |
| Interest Coverage Ratio (TTM) | 2.30 | 4.38 |
Growth
The following charts compare key year-over-year (YoY) growth metrics for AEP and NRG. These metrics are based on the companies’ annual financial reports.
Revenue Growth
Earnings Per Share (EPS) Growth
Free Cash Flow Growth
Dividend
Dividend Yield
AEP
3.53%
Regulated Electric Industry
- Max
- 6.60%
- Q3
- 4.03%
- Median
- 3.30%
- Q1
- 3.06%
- Min
- 0.00%
AEP’s Dividend Yield of 3.53% is consistent with its peers in the Regulated Electric industry, providing a dividend return that is standard for its sector.
NRG
1.07%
Independent Power Producers Industry
- Max
- 12.31%
- Q3
- 1.36%
- Median
- 0.46%
- Q1
- 0.00%
- Min
- 0.00%
NRG’s Dividend Yield of 1.07% is consistent with its peers in the Independent Power Producers industry, providing a dividend return that is standard for its sector.
Dividend Payout Ratio
AEP
70.11%
Regulated Electric Industry
- Max
- 123.06%
- Q3
- 69.07%
- Median
- 62.27%
- Q1
- 52.66%
- Min
- 0.00%
AEP’s Dividend Payout Ratio of 70.11% is in the upper quartile for the Regulated Electric industry. This indicates a strong commitment to shareholder returns but also suggests that a smaller portion of earnings is retained for reinvestment compared to many peers.
NRG
29.91%
Independent Power Producers Industry
- Max
- 233.96%
- Q3
- 32.48%
- Median
- 25.36%
- Q1
- 5.20%
- Min
- 0.00%
NRG’s Dividend Payout Ratio of 29.91% is within the typical range for the Independent Power Producers industry, suggesting a balanced approach between shareholder payouts and company reinvestment.
Dividend at a Glance
| Symbol | AEP | NRG |
|---|---|---|
| Dividend Yield (TTM) | 3.53% | 1.07% |
| Dividend Payout Ratio (TTM) | 70.11% | 29.91% |
Valuation
Price-to-Earnings Ratio
AEP
20.04
Regulated Electric Industry
- Max
- 26.46
- Q3
- 21.71
- Median
- 19.07
- Q1
- 17.74
- Min
- 12.74
AEP’s P/E Ratio of 20.04 is within the middle range for the Regulated Electric industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.
NRG
22.99
Independent Power Producers Industry
- Max
- 27.32
- Q3
- 26.49
- Median
- 23.81
- Q1
- 10.35
- Min
- 3.54
NRG’s P/E Ratio of 22.99 is within the middle range for the Independent Power Producers industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.
Forward P/E to Growth Ratio
AEP
2.79
Regulated Electric Industry
- Max
- 4.21
- Q3
- 3.10
- Median
- 2.78
- Q1
- 2.34
- Min
- 1.46
AEP’s Forward PEG Ratio of 2.79 is within the middle range of its peers in the Regulated Electric industry. This suggests a reasonable balance between the stock’s price and its expected growth, aligning with sector valuation norms.
NRG
2.07
Independent Power Producers Industry
- Max
- 5.73
- Q3
- 4.40
- Median
- 2.18
- Q1
- 1.13
- Min
- 0.32
NRG’s Forward PEG Ratio of 2.07 is within the middle range of its peers in the Independent Power Producers industry. This suggests a reasonable balance between the stock’s price and its expected growth, aligning with sector valuation norms.
Price-to-Sales Ratio
AEP
2.75
Regulated Electric Industry
- Max
- 3.88
- Q3
- 3.19
- Median
- 2.68
- Q1
- 1.96
- Min
- 0.27
AEP’s P/S Ratio of 2.75 aligns with the market consensus for the Regulated Electric industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
NRG
1.06
Independent Power Producers Industry
- Max
- 3.66
- Q3
- 3.17
- Median
- 1.99
- Q1
- 1.36
- Min
- 0.62
In the lower quartile for the Independent Power Producers industry, NRG’s P/S Ratio of 1.06 indicates its revenue is valued more conservatively than most of its peers. This could present a compelling opportunity if the market has overlooked its sales-generating capabilities.
Price-to-Book Ratio
AEP
2.03
Regulated Electric Industry
- Max
- 2.95
- Q3
- 2.37
- Median
- 1.89
- Q1
- 1.43
- Min
- 0.55
AEP’s P/B Ratio of 2.03 is within the conventional range for the Regulated Electric industry. This shows a balanced market view, where the stock’s price is neither at a significant premium nor a discount to the book value of its peers.
NRG
11.29
Independent Power Producers Industry
- Max
- 13.74
- Q3
- 11.59
- Median
- 7.05
- Q1
- 1.63
- Min
- 1.18
NRG’s P/B Ratio of 11.29 is within the conventional range for the Independent Power Producers industry. This shows a balanced market view, where the stock’s price is neither at a significant premium nor a discount to the book value of its peers.
Valuation at a Glance
| Symbol | AEP | NRG |
|---|---|---|
| Price-to-Earnings Ratio (P/E, TTM) | 20.04 | 22.99 |
| Forward PEG Ratio (TTM) | 2.79 | 2.07 |
| Price-to-Sales Ratio (P/S, TTM) | 2.75 | 1.06 |
| Price-to-Book Ratio (P/B, TTM) | 2.03 | 11.29 |
| Price-to-Free Cash Flow Ratio (P/FCF, TTM) | -42.71 | 13.68 |
| EV-to-EBITDA (TTM) | 14.06 | 11.14 |
| EV-to-Sales (TTM) | 5.07 | 1.41 |