American Electric Power rallies on planned sale of U.S. wind, solar
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American Electric Power (AEP
+2.2%) trades higher after reporting better than expected Q4 earnings and revenues, raising FY 2022 earnings guidance, and planning to sell some or all of of its renewable energy portfolio to focus on its core utility business.
AEP Renewables owns 10 wind farms and four solar farms across the U.S. that generate 1.6 GW of power, and the company said these are the assets that could be sold.
The company said it will shift $1.5B from its five-year capital spending plan to transmission and eliminate growth capital in the unregulated contracted renewables business, which will raise planned transmission capital spending to $14.4B.
AEP raised its FY 2022 operating EPS guidance to $4.87-$5.07, in line with $4.97 analyst consensus estimate, its long-term growth rate target to 6%-7%, and its FFO-to-debt target to 14%-15%.
"Our load growth in 2021 was the strongest in more than a decade as the economy recovered from the impacts of the pandemic, and we expect to maintain that momentum this year," the company said.
American Electric Power's price return rose 8% over the past year while falling 5% YTD.