Discounted Cash Flow

American Electric Power Co. Inc.

AEP · Based on 10 years of SEC filings

Average annual growth rates

Metric 10-Year 5-Year 3-Year
Sales
Free Cash Flow
Average (FCF & NI)
Net Income

Average annual growth is the mean year-over-year change across each period.

Endpoint CAGR (better for long term trend)

Metric 10-Year 5-Year 3-Year
Sales
Free Cash Flow
Average (FCF & NI)
Net Income

Endpoint CAGR is the compound annual rate from the first to last year in each period.

Projections use average year-over-year growth. Change this in Settings.

Projected growth rate

Free cash flow growth
10-year: — 5-year: — 3-year: —
Averaged growth (FCF & NI)
10-year: — 5-year: — 3-year: —
Net income growth
10-year: — 5-year: — 3-year: —
Sales growth (not added to calculations)
10-year: — 5-year: — 3-year: —

Click a greyed-out slider to switch metrics. Slide between the 10-year, 5-year, and 3-year historic growth rates for FCF, net income, or their average.

%
%

Historical inputs (10 fiscal years)

YEAR Sales Net Income Free Cash Flow Net Margin EPS (diluted)
2016 $16.4b $618.0m $-3.0b 3.8% $1.24
2017 $15.4b (-5.8%) $1.9b (212.1%) $-2.3b (23.0%) 12.5% (231.4%) $3.89 (213.7%)
2018 $16.2b (5.0%) $1.9b (-0.3%) $-2.1b (10.7%) 11.9% (-5.0%) $3.90 (0.3%)
2019 $15.6b (-3.9%) $1.9b (-0.2%) $2.7b (230.3%) 12.3% (3.9%) $3.89 (-0.3%)
2020 $14.9b (-4.1%) $2.2b (14.4%) $2.2b (-20.0%) 14.7% (19.4%) $4.44 (14.1%)
2021 $16.8b (12.6%) $2.5b (13.3%) $1.9b (-12.5%) 14.8% (0.6%) $4.97 (11.9%)
2022 $19.6b (17.0%) $2.3b (-7.3%) $-1.4b (-173.4%) 11.7% (-20.8%) $4.51 (-9.3%)
2023 $19.0b (-3.3%) $2.2b (-4.0%) $-2.4b (-71.0%) 11.7% (-0.7%) $4.26 (-5.5%)
2024 $20.0b (5.2%) $3.0b (34.5%) $-827.0m (65.0%) 14.9% (27.8%) $5.60 (31.5%)
2025 $21.7b (8.7%) $3.7b (24.2%) $-1.5b (-82.5%) 17.0% (14.3%) $6.70 (19.6%)

Base FCF: (latest fiscal year)

Discount rate: %

Terminal growth:

Projection period: years

Alt A decline yrs:

Alt B total yrs:

Values abbreviated: b = billions, m = millions, k = thousands.

Projected cash flows

Year Projected cash flow Discount Factor Present Value

PV of projected FCF:

Terminal FCF:

Terminal value:

PV of terminal value:

Enterprise value (DCF):

DCF price per share:

Current price:

Alternative DCF Models

Model Fair Value Upside PV(FCFs) PV(Terminal) Total Years
Standard (10yr→TV) 10 + TV
Alt A (Gradual Decline)
Alt B (30yr Hard Stop) N/A

This is a simplified DCF model for illustration. It uses reported free cash flow, a single growth assumption, fixed WACC, and a Gordon Growth terminal value. It is not investment advice.

+ 10YR Financials Balance Sheet (10YR) Cash Flow (10YR) DCF Model