Korea Electric Power (NYSE:KEP) versus American Electric Power (AEP) Financial Analysis

Korea Electric Power (NYSE: KEP) and American Electric Power (NYSE:AEP) are both large-cap utilities companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, profitability, earnings, dividends, risk and institutional ownership.

Institutional & Insider Ownership

4.8% of Korea Electric Power shares are held by institutional investors. Comparatively, 71.0% of American Electric Power shares are held by institutional investors. 1.0% of Korea Electric Power shares are held by company insiders. Comparatively, 0.2% of American Electric Power shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Korea Electric Power and American Electric Power’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Korea Electric Power $51.76 billion 0.43 $6.34 billion $3.06 5.70
American Electric Power $16.40 billion 2.32 $610.90 million $3.83 20.21

Korea Electric Power has higher revenue and earnings than American Electric Power. Korea Electric Power is trading at a lower price-to-earnings ratio than American Electric Power, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Korea Electric Power has a beta of 0.5, indicating that its share price is 50% less volatile than the S&P 500. Comparatively, American Electric Power has a beta of 0.3, indicating that its share price is 70% less volatile than the S&P 500.

Profitability

This table compares Korea Electric Power and American Electric Power’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Korea Electric Power 7.44% 6.06% 2.47%
American Electric Power 12.21% 9.67% 2.73%

Dividends

American Electric Power pays an annual dividend of $2.48 per share and has a dividend yield of 3.2%. Korea Electric Power does not pay a dividend. American Electric Power pays out 64.8% of its earnings in the form of a dividend. American Electric Power has raised its dividend for 4 consecutive years.

Analyst Ratings

This is a summary of current recommendations and price targets for Korea Electric Power and American Electric Power, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Korea Electric Power 1 4 2 0 2.14
American Electric Power 0 8 5 0 2.38

American Electric Power has a consensus target price of $73.91, suggesting a potential downside of 4.50%. Given American Electric Power’s stronger consensus rating and higher possible upside, analysts clearly believe American Electric Power is more favorable than Korea Electric Power.

Summary

American Electric Power beats Korea Electric Power on 12 of the 17 factors compared between the two stocks.

Korea Electric Power Company Profile

Korea Electric Power Corporation (KEPCO) is an integrated electric utility company engaged in the transmission and distribution of electricity in the Republic of Korea. Its segments include transmission and distribution, nuclear power generation and thermal power generation and all others . The transmission and distribution segment, which is operated by KEPCO, comprise operations related to the transmission, distribution and sale to end-users of electricity. The nuclear power generation segment, which is engaged in the nuclear, hydro, pumping-up power generation. The thermal power generation segment, which is engaged in bituminous coal, anthracite, liquefied natural gas (LNG) power generation. And the Other Segment comprises operations related to the plant design, power generation equipment assembly, nuclear raw materials supplement, electricity IT service, renewable source power generation and financial investment on overseas businesses.

American Electric Power Company Profile

American Electric Power Company, Inc. (AEP) is a public utility holding company that owns, directly or indirectly, all of the outstanding common stock of its public utility subsidiaries and varying percentages of other subsidiaries. The service areas of the Company’s public utility subsidiaries cover the states of Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia and West Virginia. The Company’s segments include Vertically Integrated Utilities, Transmission and Distribution Utilities, AEP Transmission Holdco, and Generation & Marketing. AEP’s vertically integrated utility operations are engaged in the generation, transmission and distribution of electricity for sale to retail and wholesale customers. Transmission and Distribution Utilities segment consists of the transmission and distribution of electricity for sale to retail and wholesale customers. AEP Transmission Holdco develops, constructs and operates transmission facilities.

Receive News & Ratings for Korea Electric Power Corporation Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Korea Electric Power Corporation and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply