American Electric Power Company, Inc. (AEP): 3Q Preview: High Bar to Clear

Investor expectations are high heading into the 3Q update, which is anticipated to include a significant increase to the capital plan and visibility into the longer term EPS potential. Possible to see annual EPS guidance through 2028 and a longer-term EPS CAGR of at least 9.5%. We expect AEP to reaffirm 2026 EPS guidance and likely introduce 2027 and 2028 EPS guidance as well. The company also indicated it is seriously considering rolling forward its five-year capital plan to a seven-year program for 2027-2033. AEP's current five-year 2026-2030 capital program is $78 billion and the company has already identified $10 billion of incremental investment opportunities. Incorporating in these incremental opportunities and new conservative investment amounts on top of that, we estimate at least a $93 billion capital plan for 2027-2031, which would be nearly a 20% increase. AEP has indicated that it would likely fund incremental capital with 30-40% equity. On our estimates, an update like thi