Upside case
Bull case
$12-17.7%
The bull case prices AES at 5x on FY1 earnings, assuming continued execution and no meaningful deceleration in the core business.
Analysis OverviewHoldUpdated May 1, 2026
The AES Corporation (AES) Stock Analysis
Wall Street verdict, consensus price target, and analyst rating breakdown — everything needed to frame the risk/reward at today's price.
Analyst consensus
Hold
Covering
21
analysts
10 bullish · 0 bearish · 21 covering AES
Strong Buy
0
Buy
10
Hold
11
Sell
0
Strong Sell
0
Consensus Target
$18
+27.0% vs today
Scenario Range
$5 – $12
Model bear to bull value window
Coverage
21
Published analyst ratings
Valuation Context
6.2x
Forward P/E · Market cap $10.2B
AES price targets
Three scenarios for where AES stock could go
Current
~$14
Confidence
50 / 100
Updated
May 1, 2026
Where we are now
Current · $14
Bear
$5
Base
$20
Bull
$12
Market caseClosest to today
Base case
$20+40.6%
At 9x on FY1 earnings, the base case reflects a reasonable but not stretched valuation. It prices in continued growth without assuming an exceptional setup.
Stress case
Bear case
$5-64.3%
If investor confidence fades or macro conditions deteriorate, a 4x multiple contraction could push AES down roughly 64% from where it trades now.
Not financial advice. Model confidence reflects internal scenario assumptions, not a guarantee of returns. Past performance does not predict future results.
The AES Corporation
AES · NYSEUtilitiesDiversified UtilitiesDecember year-end
AES Corporation is a global power generation and utility company that operates electricity plants and distribution networks across multiple countries. It makes money primarily through selling electricity via long-term power purchase agreements to utilities and industrial customers—with its generation business contributing roughly 70% of revenue and its utilities segment about 30%. The company's competitive advantage lies in its geographic diversification across emerging and developed markets and its growing portfolio of renewable energy projects—which provide stable contracted cash flows.
Market Cap
$10.2B
Revenue TTM
$12.5B
Net Income TTM
$1.1B
Net Margin
8.4%
AES Revenue and Earnings Performance
Quarterly beat-or-miss track record against analyst estimates, plus forward revenue and EPS outlook for the next two fiscal years.
EPS Beat Rate
75%Exceptional
12 quarters tracked
Revenue Beat Rate
25%Exceptional
vs consensus estimates
Avg EPS Surprise
+12.7%
above Street consensus
Beat / Miss Record
BeatMissLeft = EPS · Right = Revenue
Q2 2025
Q3 2025
Q4 2025
Q1 2026
Last 4 Quarters
EPS beats: 3 of 4Q2 2025
EPS
$0.27/$0.37
Revenue
$2.9B/$3.0B
Q3 2025
EPS
$0.51/$0.39
Revenue
$2.9B/$3.4B
Q4 2025
EPS
$0.75/$0.71
Revenue
$3.4B/$3.4B
Q1 2026
EPS
$0.81/$0.62
Revenue
$3.1B/$3.0B
| Quarter | EPS (Actual / Est) | EPS Surprise | Revenue (Actual / Est) | Rev Surprise |
|---|---|---|---|---|
| Q2 2025 | $0.27/$0.37 | -27.0% | $2.9B/$3.0B | -4.0% |
| Q3 2025 | $0.51/$0.39 | +30.8% | $2.9B/$3.4B | -15.2% |
| Q4 2025 | $0.75/$0.71 | +5.3% | $3.4B/$3.4B | -0.5% |
| Q1 2026 | $0.81/$0.62 | +30.6% | $3.1B/$3.0B | +2.3% |
FY1–FY2 Estimates
Revenue Outlook
FY1
$12.3B
+0.9% YoY
FY2
$12.4B
+0.7% YoY
EPS Outlook
FY1
$1.65
+31.4% YoY
FY2
$1.77
+7.3% YoY
Trailing FCF (TTM)-$1.5B
FCF Margin: -11.8%
Next Earnings
May 7, 2026
Expected EPS
$0.38
Expected Revenue
$3.1B
AES beat EPS estimates in 3 of 4 tracked quarters. A strong delivery record supports forward estimate credibility.
AES Revenue Breakdown by Segment
Product and geographic revenue mix from the latest annual disclosure, with year-over-year growth by segment.
Latest disclosure
FY 2025
Total disclosed revenue $4.0B
Product Mix
Latest annual revenue by segment or product family
Utilities
100.0%
+11.9% YoY
Tap, hover, or focus a slice to inspect segment detail.
Geographic Mix
Latest annual revenue by reported region
Segment breakdown not available for this company.
Utilities is the largest disclosed segment at 100.0% of FY 2025 revenue, up 11.9% YoY.
AES Valuation Snapshot
Current multiples compared to the S&P 500, the company's sector, and its own five-year average.
Relative Value Signal
Significantly Undervalued
Fair value est. $44 — implies +207.6% from today's price.
Upside to Fair Value
207.6%
potential upside
Deep DiscountFair ValueVery Expensive
vs S&P 500 Trailing P/E
AES
11.4x
vs
S&P 500
25.1x
55% discount
vs Utilities Trailing P/E
AES
11.4x
vs
Utilities
20.1x
43% discount
vs AES 5Y Avg P/E
Today
11.4x
vs
5Y Average
23.9x
52% discount
Forward PE
6.2x
S&P 500
19.1x
-68%
Utilities
17.5x
-65%
5Y Avg
—
—
Trailing PE
11.4x
S&P 500
25.1x
-55%
Utilities
20.1x
-43%
5Y Avg
23.9x
-52%
PEG Ratio
0.15x
S&P 500
1.72x
-92%
Utilities
1.69x
-91%
5Y Avg
—
—
EV/EBITDA
11.2x
S&P 500
15.2x
-26%
Utilities
11.4x
-1%
5Y Avg
11.1x
+1%
Price/FCF
—
S&P 500
21.1x
—
Utilities
15.1x
—
5Y Avg
—
—
Price/Sales
0.8x
S&P 500
3.1x
-73%
Utilities
2.2x
-61%
5Y Avg
1.1x
-26%
Dividend Yield
4.90%
S&P 500
1.87%
+162%
Utilities
3.06%
+60%
5Y Avg
3.62%
+35%
| Metric | AES | S&P 500 | Utilities | 5Y Avg AES |
|---|---|---|---|---|
| Forward PE | 6.2x | 19.1x-68% | 17.5x-65% | — |
| Trailing PE | 11.4x | 25.1x-55% | 20.1x-43% | 23.9x-52% |
| PEG Ratio | 0.15x | 1.72x-92% | 1.69x-91% | — |
| EV/EBITDA | 11.2x | 15.2x-26% | 11.4x | 11.1x |
| Price/FCF | — | 21.1x | 15.1x | — |
| Price/Sales | 0.8x | 3.1x-73% | 2.2x-61% | 1.1x-26% |
| Dividend Yield | 4.90% | 1.87% | 3.06% | 3.62% |
AES trades above S&P 500 benchmarks on 0 of 5 measured multiples — appears modestly priced relative to the S&P 500 on most measures.
Forward P/E and PEG reflect analyst consensus estimates. Historical averages use trailing ratios where forward data is unavailable.S&P 500 and sector benchmarks both use trailing median P/E — similar readings indicate the broader index and sector are priced alike.
Open valuation toolAES Financial Health
Verdict
Adequate
AES earns 11.8% operating margin on regulated earnings, 4.9% dividend yield. Utilities carry higher leverage than industrials as a structural feature of the business model.
Regulated Operations
Revenue, regulated margins, and earnings
Revenue (TTM)
Trailing-twelve-month sales base
$12.5B
Revenue Growth
TTM vs prior year
+3.0%
Operating Margin
Operating income divided by revenue
11.8%
Net Margin
Net income divided by revenue
8.4%
EPS (TTM)
Diluted earnings per share, trailing twelve months
—
Operating Margin
Operating income over revenue — primary regulated earnings signal
11.8%
Capital Quality
ROIC, leverage, and debt serviceability
ROIC
Return on invested capital — primary competitive quality signal
3.9%
ROA
Return on assets, trailing twelve months
2.1%
Cash & Equivalents
Liquid assets on the balance sheet
$2.1B
Net Debt
Total debt minus cash
$28.3B
Debt Serviceability
Net debt as a multiple of annual free cash flow
—
Regulated utilities typically operate at 3–5× net debt/FCF — this is structural, not a risk flag.
ROE *
Return on equity, trailing twelve months
10.7%
* Elevated by buyback-compressed equity — compare ROIC (3.9%) for an undistorted picture of capital efficiency.
Shareholder Returns
How capital is returned to owners
Total shareholder yield
4.9%
Dividend
4.9%
Buyback
0.0%
Share Repurchases
Trailing buyback outflow — dollar magnitude of capital returned
$0
Dividend / Share
Annualized trailing dividend per share
$0.70
Payout Ratio
Share of earnings distributed as dividends
52.8%
Shares Outstanding
Current diluted share count
713M
All figures from the trailing twelve months. Utilities operate with structural leverage (3–5× net debt/FCF) due to regulated, predictable cash flows.
Open full ratios pageAES Stock Risk Factors
Key factors that could pressure the stock price, compress the multiple, or weigh on future results.
AI analysis · updated April 29, 2026
High Risk
High Debt Levels
AES carries a substantial amount of debt, with a net debt of approximately $21.2 billion as of December 2022. Its debt-to-EBITDA ratio is around 6.2, indicating a significant reliance on leverage, which can be risky for a company with negative free cash flow.
High Risk
Funding Gap and Equity Issuance
The company faces a $1.5 billion funding gap for its renewable energy expansion. Potential equity issuance to cover this gap could dilute existing shareholders, impacting their ownership stake.
High Risk
Declining Financial Metrics
Projections show a significant decline in AES's return on equity (ROE) from 91.6% in 2022 to an estimated 34.2% in 2026. This decline, along with decreasing operating margins, poses a substantial risk to financial performance.
Medium
Cash Burn
AES has experienced significant cash burn, with negative levered free cash flow of $5.7 billion in the last twelve months. This cash outflow is largely due to substantial capital expenditures for renewable energy expansion.
Medium
Customer Concentration Risk
Reliance on Power Purchase Agreements (PPAs) with a limited number of customers creates concentration risk. If key customers face financial difficulties, it could significantly impact AES's cash flows.
Medium
Renewable Energy Transition Challenges
AES aims to add 25-30 gigawatts of renewable energy capacity by 2027, but current build rates are lagging behind targets. Permitting delays and interconnection issues present significant hurdles to achieving these goals.
Lower
Regulatory and Legal Changes
AES faces risks from evolving environmental laws and emissions reduction mandates. Changes in regulations affecting competition and asset recovery could also impact the company's operations.
Lower
Political Instability in Key Markets
Operations in developing countries expose AES to economic and political instability, which can lead to unpredictable financial performance. For example, energy sector reforms in Argentina pose risks to operations.
These are risk mechanisms, not predictions. The key question is which would force a cut to earnings estimates or a lower multiple than the market currently prices in.
Why AES Stock Could Outperform
Structural drivers behind the upside case and why the stock could outperform over the next 12 months.
AI analysis · updated April 29, 2026
Clean Energy Focus and Growth
AES is actively expanding its renewables portfolio, with renewables EBITDA growing significantly year-over-year. The company is seeing strong demand for renewable energy solutions, particularly from data centers, leading to substantial Power Purchase Agreements (PPAs) signed. Their diversified generation portfolio, with over 53% renewable energy, is expected to capture a larger share of EBITDA by 2027.
Financial Stability and Growth Prospects
AES has a robust capital expenditure plan to enhance its energy infrastructure and is transitioning from coal to gas generation. A significant portion of its EBITDA comes from regulated utility operations, which are projected to achieve a ~10% compound annual growth rate in their rate base, contributing to financial stability.
Dividend Growth
AES has a history of increasing its dividend for over a decade, making it an attractive option for income-focused investors.
Takeover Potential
There have been reports of takeover interest from investor consortiums, which has driven up the stock price and suggests potential future value. An acquisition at $15 per share has been agreed upon, which reframes the short-term catalysts and risks around deal timing and approvals.
A real bull case compounds — each driver matters most when it strengthens margins, supports capital returns, and keeps the company above the market's minimum growth bar simultaneously.
AES Stock Price Performance
52-week range context and price returns across multiple time horizons. Dividend contribution is shown separately in the Capital Return section.
Current Price
$14.37
52W Range Position
60%
52-Week Range
Current price plotted between the 52-week low and high.
52-Week Low
$9.46
+51.9% from the low
52-Week High
$17.65
-18.6% from the high
1 Month
+0.28%
3 Month
-7.83%
YTD
-3.0%
1 Year
+40.1%
3Y CAGR
-14.1%
5Y CAGR
-11.5%
10Y CAGR
+2.6%
Range context matters because valuation compression and earnings misses rarely hit from the same starting point. A stock already far below its high can still fall, but it is no longer carrying the same embedded optimism as one pressing a fresh peak.
AES vs Peers
Valuation, growth, and margin comparison against the closest publicly traded peers for this company.
Peer Set
Accurate peer set
Forward PE
6.2x
vs 17.6x median
-65% below peer median
Revenue Growth
+0.9%
vs +9.1% median
-90% below peer median
Net Margin
8.4%
vs 12.8% median
-34% below peer median
| Company | Mkt Cap | Fwd PE | Rev Grw | Margin | Rating | Upside |
|---|---|---|---|---|---|---|
AES AES The AES Corporation | $10.2B | 6.2x | +0.9% | 8.4% | Hold | +27.0% |
NRG NRG NRG Energy, Inc. | $30.0B | 17.2x | +9.1% | 2.8% | Buy | +23.2% |
VST VST Vistra Corp. | $54.3B | 18.7x | +9.7% | 5.6% | Buy | +41.9% |
GEN GEN Gen Digital Inc. | $12.2B | 7.7x | +6.8% | 12.8% | Buy | +62.4% |
NEE NEE NextEra Energy, Inc. | $200.8B | 23.8x | +9.1% | 29.3% | Buy | +1.9% |
D D Dominion Energy, Inc. | $55.4B | 17.6x | +5.7% | 13.5% | Hold | +5.2% |
This peer comparison reflects companies with similar business models, product lines, or market positioning, supplemented by industry grouping when direct matches are limited.
AES Dividend and Capital Return
AES returns 4.9% total yield, led by a 4.90% dividend, raised 13 consecutive years.
Dividend SustainableFCF Unknown
Total Shareholder Yield
4.9%
Dividend + buyback return per year
Buyback Yield
0.0%
Dividend Yield
4.90%
Payout Ratio
52.8%
How AES Splits Its Return
Div 4.90%
Dividend 4.90%Buybacks 0.0%
Dividend Profile
Yield, cadence, and growth quality
Dividend / Share
Trailing annualized cash dividend
$0.70
Growth Streak
Consecutive years of dividend increases
13Y
3Y Div CAGR
3.7%
5Y Div CAGR
4.2%
Ex-Dividend Date
—
Payment Cadence
Quarterly
4 payments over the last 12 months
Buyback Engine
How much per-share support comes from repurchases
Repurchases (TTM)
Cash used for buybacks in the latest trailing period
$0
Estimated Shares Retired
0
Approx. Share Reduction
0.0%
Shares Outstanding
Current diluted share count from the screening snapshot
713M
| Year | Div / Share | YoY Grw | BB Yield | Total Yield |
|---|---|---|---|---|
| 2026 | $0.35 | — | — | — |
| 2025 | $0.70 | +2.0% | 0.0% | 4.9% |
| 2024 | $0.69 | +4.0% | 0.0% | 5.3% |
| 2023 | $0.66 | +5.0% | 0.0% | 3.2% |
| 2022 | $0.63 | +5.0% | 0.0% | 2.2% |
FAQ
7 questionsAES Investor Questions
Common questions answered from live analyst data and company financials.
01Is The AES Corporation (AES) stock a buy or sell in 2026?
The AES Corporation (AES) is rated Hold by Wall Street analysts as of 2026. Of 21 analysts covering the stock, 10 rate it Buy or Strong Buy, 11 rate it Hold, and 0 rate it Sell or Strong Sell. The consensus 12-month price target is $18, implying +27.0% from the current price of $14. The bear case scenario is $5 and the bull case is $12.
02What is the AES stock price target for 2026?
The Wall Street consensus price target for AES is $18 based on 21 analyst estimates. The high-end target is $23 (+60.1% from today), and the low-end target is $16 (+11.3%). The base case model target is $20.
03Is The AES Corporation (AES) stock overvalued in 2026?
AES trades at 6.2x times forward earnings. The stock currently trades at a discount to the broader market. Based on current multiples versus the peer group, the relative model signals significantly undervalued. Whether the stock is over or undervalued ultimately depends on whether consensus earnings estimates are achievable.
04What are the main risks for The AES Corporation (AES) stock in 2026?
The primary risks for AES in 2026 are: (1) High Debt Levels — AES carries a substantial amount of debt, with a net debt of approximately $21. (2) Funding Gap and Equity Issuance — The company faces a $1. (3) Declining Financial Metrics — Projections show a significant decline in AES's return on equity (ROE) from 91. Each factor has the potential to pressure earnings or compress the stock's valuation multiple.
05What is The AES Corporation's revenue and earnings forecast?
Analyst consensus estimates AES will report consensus revenue of $12.3B (+0.9% year-over-year) and EPS of $1.65 (+31.4% year-over-year) for the upcoming fiscal year. The following year, analysts project $12.4B in revenue.
06When does The AES Corporation (AES) report its next earnings?
The AES Corporation is expected to report its next earnings on approximately 2026-05-07. Consensus expects EPS of $0.38 and revenue of $3.1B. Over recent quarters, AES has beaten EPS estimates 75% of the time.
07How much free cash flow does The AES Corporation generate?
The AES Corporation (AES) had a free cash outflow of $1.5B in free cash flow over the trailing twelve months — a free cash flow margin of 11.8%. AES returns capital to shareholders through dividends (4.9% yield) and share repurchases ($0 TTM).