10 Most Undervalued Utility Stocks to Invest in Now

6. American Electric Power Company, Inc. (NASDAQ:AEP)

Forward P/E as on March 4: ~17.7x

Number of Hedge Fund Holders: 47

American Electric Power Company, Inc. (NASDAQ:AEP) is engaged in the generation, transmission, and distribution of electricity for sale to retail and wholesale customers. The company’s commitment to decarbonizing its generation fleet remains in line with the broader industry trends and regulatory pressures to reduce the carbon emissions. This strategic emphasis is expected to yield numerous benefits for the company. With states and the federal government pushing for cleaner energy, American Electric Power Company, Inc. (NASDAQ:AEP)’s proactive approach to decarbonization is expected to lead to more favorable regulatory treatment and support for investment plans.

The company expects 8%-9% annual total retail load growth from 2025-2027 and ultimately anticipates serving over 20 gigawatts of new load by the decade’s end. American Electric Power Company, Inc. (NASDAQ:AEP)’s $54 billion, 5-year capital plan continues to support this opportunity as it builds infrastructure catering to the needs of its customers, communities and the states. Additionally, the company is evaluating $10 billion of potential incremental investment throughout its service territory and regional transmission grids. Therefore, the growth of the utilities sector, driven by grid modernization and higher energy demand, is anticipated to fuel growth for American Electric Power Company, Inc. (NASDAQ:AEP) as it invests in renewable projects and transmission infrastructure.