AEP vs. TLN: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at AEP and TLN, 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 TLN’s 13.03 billion USD, indicating a significant difference in their market valuations.
TLN carries a higher beta at 1.49, indicating it’s more sensitive to market moves, while AEP (beta: 0.41) exhibits greater stability.
| Symbol | AEP | TLN |
|---|---|---|
| Company Name | American Electric Power Company, Inc. | Talen Energy Corporation |
| Country | US | US |
| Sector | Utilities | Utilities |
| Industry | Regulated Electric | Independent Power Producers |
| CEO | William J. Fehrman | Mark Allen McFarland |
| Price | 103.86 USD | 286.31 USD |
| Market Cap | 55.48 billion USD | 13.03 billion USD |
| Beta | 0.41 | 1.49 |
| Exchange | NASDAQ | NASDAQ |
| IPO Date | January 2, 1962 | June 2, 2023 |
| ADR | No | No |
Historical Performance
This chart compares the performance of AEP and TLN 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.
TLN
30.49%
Independent Power Producers Industry
- Max
- 47.87%
- Q3
- 44.92%
- Median
- 37.16%
- Q1
- 23.52%
- Min
- 2.99%
TLN’s Return on Equity of 30.49% is on par with the norm for the Independent Power Producers industry, indicating its profitability relative to shareholder equity is typical for the sector.
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.
TLN
1.62%
Independent Power Producers Industry
- Max
- 12.59%
- Q3
- 7.91%
- Median
- 1.68%
- Q1
- 1.19%
- Min
- -2.93%
TLN’s Return on Invested Capital of 1.62% is in line with the norm for the Independent Power Producers industry, reflecting a standard level of efficiency in generating profits from its capital base.
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.
TLN
31.23%
Independent Power Producers Industry
- Max
- 33.58%
- Q3
- 32.41%
- Median
- 13.40%
- Q1
- 3.33%
- Min
- -15.14%
TLN’s Net Profit Margin of 31.23% 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.
TLN
5.60%
Independent Power Producers Industry
- Max
- 21.41%
- Q3
- 17.04%
- Median
- 9.17%
- Q1
- 6.05%
- Min
- 5.60%
TLN’s Operating Profit Margin of 5.60% is in the lower quartile for the Independent Power Producers industry. This indicates weaker profitability from core operations, which may stem from inefficiencies or competitive pressures on pricing.
Profitability at a Glance
| Symbol | AEP | TLN |
|---|---|---|
| Return on Equity (TTM) | 10.33% | 30.49% |
| Return on Assets (TTM) | 2.65% | 9.70% |
| Return on Invested Capital (TTM) | 4.16% | 1.62% |
| Net Profit Margin (TTM) | 13.71% | 31.23% |
| Operating Profit Margin (TTM) | 21.90% | 5.60% |
| Gross Profit Margin (TTM) | 62.60% | 33.70% |
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.
TLN
1.62
Independent Power Producers Industry
- Max
- 1.85
- Q3
- 1.84
- Median
- 1.62
- Q1
- 0.96
- Min
- 0.84
TLN’s Current Ratio of 1.62 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.
TLN
2.54
Independent Power Producers Industry
- Max
- 3.96
- Q3
- 3.42
- Median
- 2.61
- Q1
- 1.23
- Min
- 0.64
TLN’s Debt-to-Equity Ratio of 2.54 is typical for the Independent Power Producers industry, indicating its use of leverage is in line with the sector norm. This suggests a balanced approach to its capital structure.
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.
TLN
0.40
Independent Power Producers Industry
- Max
- 4.38
- Q3
- 3.24
- Median
- 1.20
- Q1
- 0.44
- Min
- -1.77
TLN’s Interest Coverage Ratio of 0.40 is a critical concern. A value below 1.0 means operating earnings are insufficient to cover interest expenses, indicating severe financial strain and high default risk.
Financial Strength at a Glance
| Symbol | AEP | TLN |
|---|---|---|
| Current Ratio (TTM) | 0.42 | 1.62 |
| Quick Ratio (TTM) | 0.31 | 1.20 |
| Debt-to-Equity Ratio (TTM) | 1.72 | 2.54 |
| Debt-to-Asset Ratio (TTM) | 0.45 | 0.51 |
| Net Debt-to-EBITDA Ratio (TTM) | 6.42 | 2.31 |
| Interest Coverage Ratio (TTM) | 2.30 | 0.40 |
Growth
The following charts compare key year-over-year (YoY) growth metrics for AEP and TLN. 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.
TLN
0.00%
Independent Power Producers Industry
- Max
- 12.31%
- Q3
- 1.36%
- Median
- 0.46%
- Q1
- 0.00%
- Min
- 0.00%
TLN currently does not pay a dividend, resulting in a yield of 0%. This is a common strategy for growth-focused companies that prioritize reinvesting earnings, though it may be less typical in mature, income-oriented sectors.
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.
TLN
0.00%
Independent Power Producers Industry
- Max
- 233.96%
- Q3
- 32.48%
- Median
- 25.36%
- Q1
- 5.20%
- Min
- 0.00%
TLN has a Dividend Payout Ratio of 0%, indicating it does not currently pay a dividend. This is a common strategy for growth-oriented companies that reinvest all profits back into the business.
Dividend at a Glance
| Symbol | AEP | TLN |
|---|---|---|
| Dividend Yield (TTM) | 3.53% | 0.00% |
| Dividend Payout Ratio (TTM) | 70.11% | 0.00% |
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.
TLN
23.07
Independent Power Producers Industry
- Max
- 27.32
- Q3
- 26.49
- Median
- 23.81
- Q1
- 10.35
- Min
- 3.54
TLN’s P/E Ratio of 23.07 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.
TLN
0.31
Independent Power Producers Industry
- Max
- 5.73
- Q3
- 4.40
- Median
- 2.18
- Q1
- 1.13
- Min
- 0.32
TLN’s Forward PEG Ratio of 0.31 is below the typical range for the Independent Power Producers industry. This is a strong indicator that the stock may be undervalued, as its price appears low given its future growth prospects.
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.
TLN
7.15
Independent Power Producers Industry
- Max
- 3.66
- Q3
- 3.17
- Median
- 1.99
- Q1
- 1.36
- Min
- 0.62
With a P/S Ratio of 7.15, TLN trades at a valuation that eclipses even the highest in the Independent Power Producers industry. This implies the market has priced in exceptionally optimistic scenarios for future revenue growth, posing considerable valuation risk.
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.
TLN
11.12
Independent Power Producers Industry
- Max
- 13.74
- Q3
- 11.59
- Median
- 7.05
- Q1
- 1.63
- Min
- 1.18
TLN’s P/B Ratio of 11.12 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 | TLN |
|---|---|---|
| Price-to-Earnings Ratio (P/E, TTM) | 20.04 | 23.07 |
| Forward PEG Ratio (TTM) | 2.79 | 0.31 |
| Price-to-Sales Ratio (P/S, TTM) | 2.75 | 7.15 |
| Price-to-Book Ratio (P/B, TTM) | 2.03 | 11.12 |
| Price-to-Free Cash Flow Ratio (P/FCF, TTM) | -42.71 | 868.66 |
| EV-to-EBITDA (TTM) | 14.06 | 13.43 |
| EV-to-Sales (TTM) | 5.07 | 8.64 |