American Electric Power Stock Market Value
| AEP Stock | USD 98.10 0.51 0.52% |
| Symbol | American |
American Electric Power Price To Book Ratio
Is Electric Utilities space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of American Electric. If investors know American will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about American Electric listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth (0.02) | Dividend Share 3.52 | Earnings Share 4.96 | Revenue Per Share 37.095 | Quarterly Revenue Growth 0.015 |
The market value of American Electric Power is measured differently than its book value, which is the value of American that is recorded on the company's balance sheet. Investors also form their own opinion of American Electric's value that differs from its market value or its book value, called intrinsic value, which is American Electric's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because American Electric's market value can be influenced by many factors that don't directly affect American Electric's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between American Electric's value and its price as these two are different measures arrived at by different means. Investors typically determine if American Electric is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, American Electric's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
American Electric 'What if' Analysis
In the world of financial modeling, what-if analysis is part of sensitivity analysis performed to test how changes in assumptions impact individual outputs in a model. When applied to American Electric's stock what-if analysis refers to the analyzing how the change in your past investing horizon will affect the profitability against the current market value of American Electric.
| 05/30/2024 |
| 11/26/2024 |
If you would invest 0.00 in American Electric on May 30, 2024 and sell it all today you would earn a total of 0.00 from holding American Electric Power or generate 0.0% return on investment in American Electric over 180 days. American Electric is related to or competes with Southern, Dominion Energy, Nextera Energy, Consolidated Edison, Duke Energy, Edison International, and FirstEnergy. American Electric Power Company, Inc., an electric public utility holding company, engages in the generation, transmissi... More
American Electric Upside/Downside Indicators
Understanding different market momentum indicators often help investors to time their next move. Potential upside and downside technical ratios enable traders to measure American Electric's stock current market value against overall market sentiment and can be a good tool during both bulling and bearish trends. Here we outline some of the essential indicators to assess American Electric Power upside and downside potential and time the market with a certain degree of confidence.
| Downside Deviation | 1.27 | |||
| Information Ratio | (0.1) | |||
| Maximum Drawdown | 6.17 | |||
| Value At Risk | (1.73) | |||
| Potential Upside | 1.58 |
American Electric Market Risk Indicators
Today, many novice investors tend to focus exclusively on investment returns with little concern for American Electric's investment risk. Other traders do consider volatility but use just one or two very conventional indicators such as American Electric's standard deviation. In reality, there are many statistical measures that can use American Electric historical prices to predict the future American Electric's volatility.| Risk Adjusted Performance | 0.0159 | |||
| Jensen Alpha | 0.0376 | |||
| Total Risk Alpha | (0.17) | |||
| Sortino Ratio | (0.09) | |||
| Treynor Ratio | (0.04) |
Sophisticated investors, who have witnessed many market ups and downs, anticipate that the market will even out over time. This tendency of American Electric's price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy.
American Electric Power Backtested Returns
Currently, American Electric Power is very steady. American Electric Power secures Sharpe Ratio (or Efficiency) of 0.0129, which signifies that the company had a 0.0129% return per unit of standard deviation over the last 3 months. We have found twenty-nine technical indicators for American Electric Power, which you can use to evaluate the volatility of the firm. Please confirm American Electric's mean deviation of 0.8676, and Risk Adjusted Performance of 0.0159 to double-check if the risk estimate we provide is consistent with the expected return of 0.0149%. American Electric has a performance score of 1 on a scale of 0 to 100. The firm shows a Beta (market volatility) of -0.24, which signifies not very significant fluctuations relative to the market. As returns on the market increase, returns on owning American Electric are expected to decrease at a much lower rate. During the bear market, American Electric is likely to outperform the market. American Electric Power right now shows a risk of 1.15%. Please confirm American Electric Power potential upside, rate of daily change, and the relationship between the sortino ratio and skewness , to decide if American Electric Power will be following its price patterns.
Auto-correlation | -0.74 |
Almost perfect reverse predictability
American Electric Power has almost perfect reverse predictability. Overlapping area represents the amount of predictability between American Electric time series from 30th of May 2024 to 28th of August 2024 and 28th of August 2024 to 26th of November 2024. The more autocorrelation exist between current time interval and its lagged values, the more accurately you can make projection about the future pattern of American Electric Power price movement. The serial correlation of -0.74 indicates that around 74.0% of current American Electric price fluctuation can be explain by its past prices.
| Correlation Coefficient | -0.74 | |
| Spearman Rank Test | -0.69 | |
| Residual Average | 0.0 | |
| Price Variance | 6.46 |
American Electric Power lagged returns against current returns
Autocorrelation, which is American Electric stock's lagged correlation, explains the relationship between observations of its time series of returns over different periods of time. The observations are said to be independent if autocorrelation is zero. Autocorrelation is calculated as a function of mean and variance and can have practical application in predicting American Electric's stock expected returns. We can calculate the autocorrelation of American Electric returns to help us make a trade decision. For example, suppose you find that American Electric has exhibited high autocorrelation historically, and you observe that the stock is moving up for the past few days. In that case, you can expect the price movement to match the lagging time series.
Current and Lagged Values |
| Timeline |
American Electric regressed lagged prices vs. current prices
Serial correlation can be approximated by using the Durbin-Watson (DW) test. The correlation can be either positive or negative. If American Electric stock is displaying a positive serial correlation, investors will expect a positive pattern to continue. However, if American Electric stock is observed to have a negative serial correlation, investors will generally project negative sentiment on having a locked-in long position in American Electric stock over time.
Current vs Lagged Prices |
| Timeline |
American Electric Lagged Returns
When evaluating American Electric's market value, investors can use the concept of autocorrelation to see how much of an impact past prices of American Electric stock have on its future price. American Electric autocorrelation represents the degree of similarity between a given time horizon and a lagged version of the same horizon over the previous time interval. In other words, American Electric autocorrelation shows the relationship between American Electric stock current value and its past values and can show if there is a momentum factor associated with investing in American Electric Power.
Regressed Prices |
| Timeline |
Pair Trading with American Electric
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if American Electric position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in American Electric will appreciate offsetting losses from the drop in the long position's value.Moving together with American Stock
Moving against American Stock
| 0.6 | ETR | Entergy | PairCorr |
| 0.54 | EDN | Empresa Distribuidora | PairCorr |
| 0.48 | AEE | Ameren Corp | PairCorr |
| 0.44 | CNP | CenterPoint Energy | PairCorr |
| 0.41 | ENIC | Enel Chile SA | PairCorr |
The ability to find closely correlated positions to American Electric could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace American Electric when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back American Electric - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling American Electric Power to buy it.
The correlation of American Electric is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as American Electric moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if American Electric Power moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for American Electric can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Additional Tools for American Stock Analysis
When running American Electric's price analysis, check to measure American Electric's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy American Electric is operating at the current time. Most of American Electric's value examination focuses on studying past and present price action to predict the probability of American Electric's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move American Electric's price. Additionally, you may evaluate how the addition of American Electric to your portfolios can decrease your overall portfolio volatility.