The AES Corporation (AES)
The AES Corporation is a diversified power generation and utility company that operates globally. It focuses on generating and distributing electricity through various fuel sources, including renewables, and serves a wide range of customers.
Company Overview
The AES Corporation (AES) offers a compelling investment in the evolving energy landscape, leveraging its diversified power generation portfolio and global presence to capitalize on the increasing demand for renewable energy solutions, while offering a solid 4.39% dividend yield.
Investment Thesis
The AES Corporation presents a compelling investment opportunity due to its strategic positioning in the evolving energy market and its commitment to renewable energy sources. With a P/E ratio of 10.10 and a dividend yield of 4.39%, AES offers a blend of value and income. The company's diverse generation portfolio, including a growing emphasis on renewables, positions it favorably to capitalize on the increasing demand for clean energy solutions. Growth catalysts include expansion into new renewable energy projects and strategic acquisitions in key markets. AES's global presence and established infrastructure provide a competitive advantage, making it a strong contender in the transition to a sustainable energy future. The company's profit margin of 9.4% indicates solid profitability, further supporting its investment appeal.
Key Highlights
- Market Cap of $11.43B reflects substantial investor confidence in AES's market position and future growth potential.
- P/E Ratio of 10.10 indicates that AES is potentially undervalued compared to its earnings, suggesting an attractive entry point for investors.
- Dividend Yield of 4.39% provides a significant income stream for investors, making AES an appealing choice for income-focused portfolios.
- Gross Margin of 16.9% demonstrates AES's ability to efficiently manage its cost of goods sold, contributing to overall profitability.
- AES operates a generation portfolio of approximately 31,459 megawatts, showcasing its significant scale and operational capacity in the power generation sector.
Competitors
Strengths
- Diversified power generation portfolio.
- Global presence in multiple countries.
- Growing expertise in renewable energy.
- Established infrastructure and customer base.
Weaknesses
- Exposure to commodity price volatility.
- Dependence on regulatory approvals.
- High capital expenditures.
- Potential for environmental liabilities.
Catalysts
- Upcoming: Completion of new renewable energy projects, expected to increase revenue and reduce carbon emissions.
- Ongoing: Government incentives and subsidies for renewable energy, providing financial support for AES's investments.
- Ongoing: Increasing demand for clean energy solutions, driving growth in AES's renewable energy business.
- Upcoming: Potential acquisitions of strategic assets in emerging markets, expanding AES's geographic footprint.
Risks
- Potential: Fluctuations in commodity prices, affecting the profitability of AES's fossil fuel-based power plants.
- Potential: Changes in government regulations and policies, impacting the economics of AES's projects.
- Ongoing: Cybersecurity threats to grid infrastructure, potentially disrupting operations and causing financial losses.
- Potential: Environmental liabilities associated with power generation, requiring costly remediation efforts.
- Ongoing: Economic downturns affecting electricity demand, reducing AES's revenue and profitability.
Growth Opportunities
- Expansion of Renewable Energy Portfolio: AES has a significant opportunity to expand its renewable energy portfolio through new projects and acquisitions. The global market for renewable energy is projected to grow exponentially, driven by government incentives and increasing consumer demand. By investing in wind, solar, and energy storage projects, AES can increase its revenue and reduce its carbon footprint. This expansion aligns with global sustainability goals and enhances AES's brand image, attracting environmentally conscious investors. The timeline for these projects typically ranges from 2 to 5 years for development and construction.
- Strategic Acquisitions in Emerging Markets: AES can pursue strategic acquisitions in emerging markets to expand its geographic footprint and access new customer bases. Emerging markets often have a high demand for electricity and a limited supply of reliable power. By acquiring existing power plants or developing new projects in these markets, AES can generate significant revenue and contribute to economic development. These acquisitions can provide immediate cash flow and long-term growth potential. Due diligence and regulatory approvals typically add 1-2 years to acquisition timelines.
- Development of Energy Storage Solutions: The increasing adoption of renewable energy sources requires advanced energy storage solutions to address intermittency issues. AES can invest in the development and deployment of energy storage technologies, such as batteries and pumped hydro storage, to provide reliable and dispatchable power. This market is expected to grow rapidly as renewable energy penetration increases. AES's expertise in power generation and grid management gives it a competitive advantage in this area. Pilot projects can be deployed within 1-2 years, with larger-scale deployments following within 3-5 years.
- Leveraging Digital Technologies for Grid Optimization: AES can leverage digital technologies, such as artificial intelligence and machine learning, to optimize grid operations and improve efficiency. These technologies can be used to predict demand, manage distributed energy resources, and reduce transmission losses. By investing in digital infrastructure, AES can reduce its operating costs and improve the reliability of its power grid. This initiative can be implemented incrementally over the next 2-3 years, with ongoing improvements and enhancements.
- Partnerships with Technology Companies: AES can form partnerships with technology companies to develop and deploy innovative energy solutions. These partnerships can provide access to new technologies, expertise, and markets. For example, AES could partner with a company specializing in smart grid technology to improve grid management or with a company developing new energy storage solutions. These partnerships can accelerate innovation and enhance AES's competitive advantage. Partnership agreements can typically be established within 6-12 months, with project implementation timelines varying based on the specific initiative.
Opportunities
- Expansion of renewable energy portfolio.
- Strategic acquisitions in emerging markets.
- Development of energy storage solutions.
- Leveraging digital technologies for grid optimization.
Threats
- Increasing competition from renewable energy providers.
- Changes in government regulations and policies.
- Economic downturns affecting electricity demand.
- Cybersecurity threats to grid infrastructure.
Competitive Advantages
- Diversified Generation Portfolio: AES's diverse portfolio of power plants using various fuel sources provides resilience against fuel price volatility and regulatory changes.
- Global Presence: AES's operations in multiple countries provide access to diverse markets and reduce reliance on any single region.
- Established Infrastructure: AES's existing infrastructure of power plants and transmission lines provides a competitive advantage in serving customers.
- Expertise in Renewable Energy: AES's expertise in developing and operating renewable energy projects positions it favorably in the growing clean energy market.
About
The AES Corporation, originally founded as Applied Energy Services, Inc. in 1981 and renamed in 2000, stands as a prominent player in the global power generation and utility sector. Headquartered in Arlington, Virginia, AES owns and operates a diverse portfolio of power plants, utilizing a broad spectrum of fuel sources including coal, gas, hydro, wind, solar, and biomass, with a growing emphasis on renewables like energy storage and landfill gas. The company generates and sells power to a diverse clientele, encompassing utilities, industrial users, and other intermediaries. AES also manages utilities that generate or purchase, distribute, transmit, and sell electricity to end-users across residential, commercial, industrial, and governmental sectors. With a generation portfolio of approximately 31,459 megawatts, AES has established a significant global footprint, operating in the United States, Puerto Rico, El Salvador, Chile, Colombia, Argentina, Brazil, Mexico, Central America, the Caribbean, Europe, and Asia. AES is committed to providing sustainable and reliable energy solutions, adapting to the changing energy landscape through investments in renewable technologies and strategic partnerships.
What They Do
- Generates electricity through a variety of fuel sources, including coal, gas, hydro, wind, solar, and biomass.
- Sells power to utilities, industrial users, and other intermediaries.
- Owns and operates utilities that distribute electricity to residential, commercial, industrial, and governmental customers.
- Purchases electricity for distribution to end-users.
- Transmits electricity through its infrastructure.
- Develops and invests in renewable energy projects, such as wind and solar farms.
- Offers energy storage solutions to improve grid reliability and integrate renewable energy sources.
Business Model
- Generates revenue by selling electricity to utilities, industrial customers, and end-users.
- Operates power plants and utilities, generating revenue from electricity sales.
- Invests in and develops renewable energy projects, generating revenue from electricity sales and government incentives.
- Provides energy storage solutions, generating revenue from grid services and energy arbitrage.
Industry Context
The diversified utilities industry is undergoing a significant transformation, driven by the increasing demand for renewable energy and the phasing out of fossil fuels. AES operates within this dynamic landscape, competing with companies like Brookfield Renewable Partners (BEP), Brookfield Infrastructure Partners (BIP), and others. The industry is characterized by heavy regulation, high capital expenditures, and long-term contracts. AES's focus on renewable energy sources positions it favorably to capitalize on the growing market for clean energy solutions, estimated to reach trillions of dollars in the coming decades. The company's global presence also provides a competitive advantage in accessing diverse markets and resources.
Key Customers
- Utilities that purchase electricity for distribution to their customers.
- Industrial users that require large amounts of electricity for their operations.
- Commercial businesses that use electricity for lighting, heating, and cooling.
- Residential customers who purchase electricity for their homes.
- Governmental entities that require electricity for public services.
Financials
Recent Quarterly Results
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $3.35B | $634M | $0.89 |
| Q2 2025 | $2.85B | -$105M | $-0.15 |
| Q1 2025 | $2.93B | $46M | $0.06 |
| Q4 2024 | $2.96B | $560M | $0.79 |
Source: Company filings
Chart & Info
Price Chart
The AES Corporation (AES) stock price: $13.53 (-0.15, -1.10%)
Why Bull
- •Recent insider buying suggests confidence in AES's long-term growth potential, indicating that management believes in the company's future prospects.
- •Community sentiment has leaned positive as discussions around renewable energy initiatives gain traction, aligning with AES's strategic focus on sustainable solutions.
- •AES's commitment to reducing carbon emissions resonates well with socially conscious investors, enhancing its reputation in the market.
- •The company's recent partnerships in renewable energy projects have sparked optimism, showcasing its proactive approach to adapting to energy market trends.
Why Bear
- •Concerns about regulatory changes in the energy sector have created uncertainty, leading some investors to question AES's ability to navigate potential challenges.
- •The market sentiment has been mixed, with bearish voices highlighting the volatility in energy prices that could impact AES's profitability.
- •Recent discussions around supply chain issues in the energy sector have raised flags about AES's operational efficiency and potential cost pressures.
- •Some community members express skepticism regarding the pace of AES's transition to renewable energy, fearing it may not be as swift as needed to meet future demands.
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Technical Analysis
Rationale
AI-generated technical analysis for AES including trend direction, momentum, and pattern recognition.
What to Watch
Key support and resistance levels, volume signals, and upcoming events.
Risk Management
Position sizing, stop-loss levels, and risk-reward assessment.
Community
Discussion
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Sentiment
Community sentiment and discussion activity for AES.
Make a Prediction
Set your price target for The AES Corporation (AES), choose a timeframe, and track your prediction accuracy.
Current price: $13.53 · Analyst target: $15.29
Analyst Consensus
Consensus Rating
Aggregated Buy/Hold/Sell recommendations from Benzinga, Yahoo Finance, and Finnhub for AES.
Price Targets
Median: $16.00 (+26.7% from current price)
Insider Flow (30d)
No insider trades in the last 30 days.
MoonshotScore
Score Factors
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Revenue Growth 2/100
Revenue declined -3.1% YoY, signaling shrinking demand or market headwinds.
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Gross Margin 3/100
Gross margin of 16.9% is below average, suggesting thin margins and potential pricing pressure.
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Operating Leverage 4/100
Limited operating leverage due to slower revenue growth, keeping profit scaling constrained.
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Cash Runway 8/100
Strong cash reserves of $1.5B provide a solid financial cushion for growth investments and market downturns.
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R&D Intensity 5/100
R&D spending data is currently unavailable for this company.
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Insider Activity 6/100
No significant insider buying or selling recently, which is neutral for the stock outlook.
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Short Interest 10/100
Daily turnover of 1.38% indicates healthy liquidity with smooth entry/exit for investors.
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Price Momentum 6/100
Mixed technical signals (above sma50, above sma200); price trend is inconclusive and may consolidate.
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News Sentiment 5/100
News sentiment is mixed, with a balance of positive and negative coverage in recent days.
What does this score mean?
The MoonshotScore rates AES's growth potential on a scale of 0-100 across multiple factors including innovation, market disruption, financial health, and momentum.
Competitors & Peers
Latest News
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CenterPoint Energy to Report Q4 Earnings: What's in the Cards?
Frequently Asked Questions
What does The AES Corporation do?
The AES Corporation is a global power generation and utility company. It owns and operates a diverse portfolio of power plants that generate electricity from various fuel sources, including coal, gas, hydro, wind, solar, and biomass. AES sells this electricity to utilities, industrial users, and other intermediaries. Additionally, AES owns and operates utilities that distribute electricity to end-users in residential, commercial, industrial, and governmental sectors. The company is increasingly focused on renewable energy and energy storage solutions to meet the growing demand for clean and reliable power.
Is AES stock a good buy?
AES stock presents a potentially attractive investment opportunity, supported by its diversified generation portfolio, global presence, and commitment to renewable energy. With a P/E ratio of 10.10 and a dividend yield of 4.39%, AES offers a blend of value and income. The company's growth prospects are driven by the increasing demand for clean energy and its strategic investments in renewable energy projects. However, investors should consider the risks associated with commodity price volatility, regulatory changes, and cybersecurity threats. A balanced assessment of these factors is crucial before making an investment decision.
What are the main risks for AES?
The main risks for AES include commodity price volatility, which can affect the profitability of its fossil fuel-based power plants. Changes in government regulations and policies can also impact the economics of AES's projects. Cybersecurity threats to grid infrastructure pose a significant risk to operations and financial stability. Environmental liabilities associated with power generation could require costly remediation efforts. Additionally, economic downturns affecting electricity demand could reduce AES's revenue and profitability. These risks should be carefully considered by investors.
Is AES a good stock to buy?
Whether AES is a good investment depends on your financial goals, risk tolerance, and investment horizon. Key factors to evaluate include the company's revenue growth trajectory, profit margins, debt-to-equity ratio, competitive moat, and valuation multiples (P/E, P/S, EV/EBITDA) relative to industry peers. Our AI-generated Investment Thesis and SWOT analysis on this page provide a data-driven starting point. Always do your own research and consider consulting a financial advisor before making investment decisions.
What is the AES MoonshotScore?
The MoonshotScore for AES is an AI-powered rating from 0 to 100 that evaluates a stock across four dimensions: growth potential (revenue and earnings trajectory), financial health (balance sheet strength, cash flow), market momentum (price trends, volume patterns, institutional flows), and risk factors (volatility, debt levels, sector headwinds). Scores above 70 indicate strong potential, 50-70 moderate, and below 50 suggests caution. The score is recalculated daily using the latest financial data and market signals.
How often is AES data updated?
AES stock prices are updated in real-time during U.S. market hours (9:30 AM - 4:00 PM ET, Monday through Friday). After-hours and pre-market prices are also tracked. Company fundamentals (earnings, revenue, balance sheet) are refreshed when new quarterly or annual reports are filed. Analyst ratings, price targets, and AI-generated insights are updated daily. Breaking news related to AES is aggregated continuously from premium financial news sources throughout the day.
What are the growth catalysts for AES?
Growth catalysts for The AES Corporation (AES) can include several categories: product catalysts (new launches, FDA approvals, patent grants), financial catalysts (earnings beats, margin expansion, share buybacks), strategic catalysts (acquisitions, partnerships, market expansion into new regions), and macro catalysts (favorable regulation, industry tailwinds, secular growth trends). Our AI analyzes The AES Corporation's specific catalysts using earnings transcripts, SEC filings, and news sentiment to identify the most impactful near-term and long-term drivers.
Who are AES's main competitors?
The AES Corporation (AES) competes with companies in its industry that target similar customers, markets, or product categories. Competitor analysis involves comparing key metrics: market share, revenue growth rates, profit margins, R&D spending, and valuation multiples. Understanding competitive positioning helps investors assess whether AES has a sustainable competitive advantage (moat) through brand strength, network effects, cost leadership, or switching costs. Our Competitors section provides a side-by-side comparison with relevant peers.
What do analysts say about AES?
Wall Street analyst coverage for AES includes consensus ratings (buy, hold, or sell), 12-month price targets, and earnings estimates. Analyst opinions are aggregated from major investment banks and research firms. Key metrics to watch include the consensus price target (average, high, and low estimates), the number of analysts covering the stock, any recent rating changes (upgrades or downgrades), and how actual earnings compare to analyst estimates (beat or miss history). Our platform aggregates these from multiple data providers for a comprehensive view.
What is AES's market cap?
Market capitalization (market cap) for AES is calculated by multiplying the current share price by the total number of outstanding shares. It represents the market's total valuation of the company. Stocks are typically categorized as mega-cap ($200B+), large-cap ($10B-$200B), mid-cap ($2B-$10B), small-cap ($300M-$2B), or micro-cap (under $300M). Market cap influences index inclusion, institutional ownership eligibility, and risk profile. Our Key Statistics section shows AES's current market cap alongside enterprise value and other valuation metrics.
How has AES stock performed recently?
AES's recent stock performance can be evaluated across multiple timeframes: daily price changes, week-over-week momentum, monthly trends, and year-to-date returns. Important performance indicators include the stock's 52-week high and low, moving averages (50-day and 200-day SMA), relative strength index (RSI), and volume trends. Comparing AES's performance against its sector index and the S&P 500 provides context on whether it is outperforming or underperforming the broader market.
What are the risks of investing in AES?
Key risk categories for AES include: market risk (overall market downturns affecting stock prices), company-specific risk (management changes, product failures, competitive threats), financial risk (high debt levels, cash burn, dilution from stock issuance), regulatory risk (government policy changes, lawsuits, compliance issues), and macroeconomic risk (interest rate changes, inflation, currency fluctuations). Beta measures AES's volatility relative to the market - a beta above 1.0 means higher volatility than the S&P 500. Our AI-generated risk assessment identifies the most relevant risk factors for this specific stock.
Are insiders buying or selling AES?
Insider trading activity for AES tracks purchases and sales by company executives, directors, and major shareholders (10%+ owners) as reported in SEC Form 4 filings. Insider buying is generally considered a bullish signal because insiders have the deepest knowledge of company operations, while selling may have various motivations (diversification, tax planning, pre-planned 10b5-1 trading plans). Key metrics include the buy-to-sell ratio, total dollar value of insider transactions, and whether multiple insiders are trading in the same direction. Our Insider Flow tab shows recent transactions with dates and dollar amounts.
Is AES a good stock for beginners?
The AES Corporation (AES) can be suitable for beginner investors depending on several factors. Look at the MoonshotScore on this page for an overall AI-powered assessment of growth potential and risk. Beginners should also check the company's market cap (larger companies tend to be less volatile), gross margin (higher margins mean stronger business fundamentals), and cash position (healthy cash reduces bankruptcy risk). Always start with a small position size and never invest money you cannot afford to lose.
How risky is AES for first-time investors?
Every stock carries risk, including The AES Corporation (AES). First-time investors should review the Risk Factors section on this page for company-specific risks. Key risk indicators include price volatility (check the chart for daily swings), insider selling activity (see Insider Flow tab), and cash runway (see MoonshotScore breakdown). A diversified portfolio with an index fund like the S&P 500 as a core holding is generally recommended before adding individual stocks like AES.
Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.
Data provided for informational purposes only.
- Financial data is based on the most recent available information.
- Future performance is subject to market conditions and company-specific factors.
- This analysis is for informational purposes only and does not constitute investment advice.