AES (AES) AI Stock Analysis

• Market Cap: $10.12B
• Dividend Yield: 4.93%
• Average Volume (3M): 11.81M
• Price to Earnings (P/E): 8.7
• Beta (1Y): 0.93
• Revenue Growth: -1.55%
• EPS Growth: 12.83%
• Country: US
• Employees: 9,100
• Sector: Utilities
• Sector Strength: 65
• Industry: Diversified Utilities
• EPS (TTM): 0.75
• Shares Outstanding: 712,121,000
• 10 Day Avg. Volume: 10,130,871
• 30 Day Avg. Volume: 11,807,634
• PEG Ratio: <0.01
• Price to Book (P/B): 2.49
• Price to Sales (P/S): 0.74
• P/FCF Ratio: -1.96
• Enterprise Value/Market Cap: 4.39
• Enterprise Value/Revenue: 3.68
• Enterprise Value/Gross Profit: 21.70
• Enterprise Value/Ebitda: 13.16
• 1Y Price Target: $17.00
• Price Target Upside: 19.13% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): 2.15
• Revenue Forecast (FY): $12.02B

• Rating: 59 Neutral
• Price Target: $14.00 ▼(-1.89% Downside)

AES's overall stock score is driven by strong earnings call highlights, including growth in renewables and strategic progress. The valuation is favorable with a low P/E ratio and high dividend yield. However, financial performance concerns, such as high leverage and negative cash flow, weigh down the score. Technical analysis shows mild bullish momentum, but not enough to significantly impact the score.

Positive Factors

Renewable Energy Growth

The significant growth in renewables EBITDA demonstrates AES's successful expansion in the renewable sector, enhancing its competitive edge and aligning with global clean energy trends.

Strong PPA Pipeline

A robust PPA pipeline ensures steady future revenue streams and strengthens AES's market position in the energy sector, supporting long-term financial stability.

Strategic Progress

Reaffirmation of guidance reflects confidence in strategic execution and financial health, indicating AES's ability to meet its long-term objectives despite market challenges.

Negative Factors

High Leverage

High leverage poses financial risks, potentially limiting AES's ability to invest in growth opportunities and increasing vulnerability to interest rate fluctuations.

Negative Cash Flow

Persistent negative cash flow indicates challenges in covering capital expenditures, which could hinder AES's capacity to fund new projects and maintain operations.

Declining Revenue

A declining revenue trend may signal underlying market or operational challenges, potentially impacting AES's long-term growth and profitability.

AES Business Overview & Revenue Model

Company Description

AES Corporation (AES) is a global energy company that operates in the electricity generation and distribution sector. Founded in 1981 and headquartered in Arlington, Virginia, AES focuses on providing sustainable and reliable energy solutions across the Americas, Europe, and Asia. The company operates a diverse portfolio of power generation facilities, including thermal, renewable, and hydroelectric power plants, and is committed to transitioning to cleaner energy sources. AES also engages in energy storage solutions and provides electricity distribution services in various regions.

How the Company Makes Money

AES generates revenue primarily through the sale of electricity generated from its power plants. The company's revenue model is anchored in long-term power purchase agreements (PPAs) with utilities and large commercial customers, ensuring a steady cash flow. Additionally, AES earns income from the sale of renewable energy credits (RECs) and environmental attributes associated with its green energy production. The company has formed strategic partnerships with various stakeholders in the energy sector, which helps to enhance its market presence and operational efficiencies. Factors contributing to its earnings include the increasing demand for renewable energy, government incentives for clean energy projects, and its ability to effectively manage operational costs across its global portfolio.

AES Financial Statement Overview

Summary

AES shows mixed financial performance with notable strengths in profitability and ROE improvement. However, declining revenue, high leverage, and negative free cash flow present significant concerns. The company needs to manage its capital expenditures and leverage to ensure sustainable growth and stability.

Income Statement

The company's revenue has shown a declining trend recently, with a 3.08% decrease from 2023 to 2024. Gross profit margin is high at 100% for 2024, indicating effective cost management relative to revenue, but this is likely due to misclassification of data. The net profit margin improved significantly from 1.97% in 2023 to 6.92% in 2024, showcasing improved profitability. However, the EBIT and EBITDA margins have fallen, pointing to operational challenges.

Balance Sheet

The debt-to-equity ratio is high at 1.70 in 2024, indicating significant leverage, which can pose financial risks. The equity ratio is relatively stable at 34.23%, suggesting a moderate reliance on equity financing. Return on equity improved to 23.30% in 2024, demonstrating effective use of equity to generate profits, though it fluctuates due to varying net income.

Cash Flow

The company experienced negative free cash flow, worsening from -$469M in 2023 to -$464M in 2024, indicating substantial capital expenditures surpassing operating cash flow. The operating cash flow to net income ratio improved to 3.24 in 2024, suggesting better cash generation relative to net income. However, the cash flow situation remains challenging with high capital expenditure needs.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	12.09B	12.28B	12.68B	12.62B	11.14B	9.66B
Gross Profit	2.05B	2.32B	2.52B	2.55B	2.71B	2.69B
EBITDA	3.38B	3.67B	2.53B	1.94B	818.00M	2.53B
Net Income	1.14B	1.69B	242.00M	-546.00M	-413.00M	43.00M
Balance Sheet
Total Assets	50.78B	47.41B	44.80B	38.36B	32.96B	34.60B
Cash, Cash Equivalents and Short-Term Investments	1.82B	1.60B	1.82B	2.10B	1.18B	1.42B
Total Debt	30.85B	29.02B	26.88B	23.50B	18.70B	19.88B
Total Liabilities	40.25B	39.70B	38.81B	33.86B	28.40B	29.88B
Stockholders Equity	3.87B	3.64B	2.49B	2.44B	2.80B	2.63B
Cash Flow
Free Cash Flow	-2.21B	-4.64B	-4.69B	-1.84B	-214.00M	855.00M
Operating Cash Flow	3.91B	2.75B	3.03B	2.71B	1.90B	2.75B
Investing Cash Flow	-4.28B	-6.23B	-6.28B	-5.70B	-3.00B	-2.00B
Financing Cash Flow	83.00M	3.49B	3.49B	3.62B	741.00M	-372.00M

AES Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 14.27
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AES, the sentiment is Positive. The current price of 14.27 is above the 20-day moving average (MA) of 14.15, above the 50-day MA of 13.65, and above the 200-day MA of 11.82, indicating a bullish trend. The MACD of 0.09 indicates Positive momentum. The RSI at 55.18 is Neutral, neither overbought nor oversold. The STOCH value of 71.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AES.

AES Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ELPC	77 Outperform	$7.64B	13.68	9.81%	5.11%	-5.28%	14.50%
CIG	77 Outperform	$6.90B	5.45	22.94%	11.53%	-3.27%	-3.44%
ELP	74 Outperform	$7.64B	14.57	9.81%	5.16%	-5.28%	14.50%
SRE	74 Outperform	$60.66B	28.62	7.10%	2.73%	9.07%	-28.58%
BIP	69 Neutral	$16.53B	30.85	10.50%	4.81%	8.14%	―
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
AES	59 Neutral	$10.12B	8.65	23.02%	4.93%	-1.55%	12.83%

AES Corporate Events

AES Reports Strong Q3 2025 Financial Results

On November 4, 2025, AES Corporation announced its financial results for the third quarter of 2025, reporting significant increases in net income and adjusted EBITDA compared to the previous year. The company reaffirmed its 2025 financial guidance and long-term growth targets, highlighting strategic accomplishments such as the addition of 3.2 GW of new projects and a backlog of 11.1 GW in signed PPAs. AES also noted progress in its US utilities sector with settlements and filings that support future growth. The company’s strong performance and strategic initiatives indicate continued profitable growth and a solid position in the renewable energy market.

The most recent analyst rating on (AES) stock is a Buy with a $24.00 price target. To see the full list of analyst forecasts on AES stock, see the AES Stock Forecast page.