WallStSmart

American Electric Power Co Inc (AEP)vsEssential Utilities Inc (WTRG)

VS

Smart Verdict

WallStSmart Research — data-driven comparison

American Electric Power Co Inc generates 787% more annual revenue ($22.79B vs $2.57B). WTRG leads profitability with a 21.6% profit margin vs 13.8%. AEP appears more attractively valued with a PEG of 1.97. AEP earns a higher WallStSmart Score of 58/100 (C).

AEP

Buy

58

out of 100

Grade: C

Growth: 4.0Profit: 6.0Value: 4.0Quality: 3.5
Piotroski: 4/9Altman Z: 0.69

WTRG

Buy

56

out of 100

Grade: C

Growth: 3.3Profit: 6.5Value: 6.0Quality: 3.0
Piotroski: 3/9Altman Z: 0.75
IV

Intrinsic Value Comparison

Multi-model valuation · Graham Formula

AEPSignificantly Overvalued (-86.9%)

Margin of Safety

-86.9%

Fair Value

$65.98

Current Price

$123.33

$57.35 premium

UndervaluedFair: $65.98Overvalued
WTRGUndervalued (+45.1%)

Margin of Safety

+45.1%

Fair Value

$68.22

Current Price

$41.07

$27.15 discount

UndervaluedFair: $68.22Overvalued

Key Strengths & Concerns

Side-by-side fundamental analysis

Key Strengths

AEP3 strengths · Avg: 8.3/10
Market CapQuality
$67.14B9/10

Large-cap with strong market position

Price/BookValuation
2.1x8/10

Reasonable price relative to book value

Operating MarginProfitability
23.3%8/10

Strong operational efficiency at 23.3%

WTRG3 strengths · Avg: 9.0/10
Operating MarginProfitability
35.4%10/10

Strong operational efficiency at 35.4%

Profit MarginProfitability
21.6%9/10

Keeps 22 of every $100 in revenue as profit

Price/BookValuation
1.7x8/10

Reasonable price relative to book value

Areas to Watch

AEP4 concerns · Avg: 2.8/10
PEG RatioValuation
1.974/10

Expensive relative to growth rate

Debt/EquityHealth
1.663/10

Elevated debt levels

EPS GrowthGrowth
-43.2%2/10

Earnings declined 43.2%

Free Cash FlowQuality
$-969.00M2/10

Negative free cash flow — burning cash

WTRG4 concerns · Avg: 3.3/10
Revenue GrowthGrowth
3.1%4/10

3.1% revenue growth

Return on EquityProfitability
7.9%3/10

ROE of 7.9% — below average capital efficiency

Debt/EquityHealth
1.213/10

Elevated debt levels

Piotroski F-ScoreQuality
3/93/10

Weak financial health signals

Comparative Analysis Report

WallStSmart Research

Bull Case : AEP

The strongest argument for AEP centers on Market Cap, Price/Book, Operating Margin.

Bull Case : WTRG

The strongest argument for WTRG centers on Operating Margin, Profit Margin, Price/Book. Profitability is solid with margins at 21.6% and operating margin at 35.4%.

Bear Case : AEP

The primary concerns for AEP are PEG Ratio, Debt/Equity, EPS Growth. Debt-to-equity of 1.66 is elevated, increasing financial risk.

Bear Case : WTRG

The primary concerns for WTRG are Revenue Growth, Return on Equity, Debt/Equity.

Key Dynamics to Monitor

WTRG carries more volatility with a beta of 0.63 — expect wider price swings.

AEP is growing revenue faster at 7.0% — sustainability is the question.

WTRG generates stronger free cash flow (-51M), providing more financial flexibility.

Monitor UTILITIES - REGULATED ELECTRIC industry trends, competitive dynamics, and regulatory changes.

Bottom Line

AEP scores higher overall (58/100 vs 56/100). WTRG offers better value entry with a 45.1% margin of safety. Both earn "Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.

This analysis is generated from publicly available financial data. Not financial advice.

American Electric Power Co Inc

UTILITIES · UTILITIES - REGULATED ELECTRIC · USA

American Electric Power (AEP) is a major investor-owned electric utility in the United States, delivering electricity to more than five million customers in 11 states.

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Essential Utilities Inc

UTILITIES · UTILITIES - REGULATED WATER · USA

Essential Utilities, Inc. operates regulated utilities that provide water, wastewater, or natural gas services in the United States. The company is headquartered in Bryn Mawr, Pennsylvania.

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