American Electric Power is one of the largest regulated utilities in the United States, providing electricity generation, transmission, and distribution to more than 5 million customers in 11 states. About 42% of AEP's of capacity is coal, with the remainder from a mix of natural gas (27%), renewable energy and hydro (21%), nuclear (8%), and demand response (2%). Vertically integrated utilities, transmission and distribution, and generation and marketing support earnings.

American Electric Power is one of the largest electric companies in the U.S. AEP is 95% regulated with generation, transmission, and distribution operations with relatively small gas operations. The company's eight vertically integrated utilities and distribution utilities deliver electricity to more than 5.6 million customers in 11 states in the Midwest and Southeast. AEP has about 29 GW of generating capacity and 225,000 distribution lines. AEP also owns the nation's largest electricity transmission system, with 40,000 system miles. Revenues in 2024 were $19.7 billion and transmission accounted for about 60%. The company had been under strategic review of its energy business which ended in 2Q24. AEP also announced new senior leadership in 3Q24. The company has divested several nonregulated operations and is well positioned to drive earnings growth through investments in its regulated business, transmission improvements, and the increased use of renewables. AEP also exited the competitive generation business in 2023, but still has wholesale electricity operations. AEP has one nuclear plant and its 2024 generation mix was 40% coal, 22% nuclear, 22% natural gas, and 16% renewables. While still heavily reliant on coal, the company is expanding its use of renewable energy with investments in wind generation. Its current renewable generation capacity is 6,000 MW and plans to have renewables and storage providing 50% of its capacity by 2033. AEP also has a record of consistent dividend growth, with about a 6% compound annual increase over the last five years. The company's market cap is $50 billion.

American Electric Power is one of the largest regulated utilities in the United States, providing electricity generation, transmission, and distribution to more than 5 million customers in 11 states. About 42% of AEP's of capacity is coal, with the remainder from a mix of natural gas (27%), renewable energy and hydro (21%), nuclear (8%), and demand response (2%). Vertically integrated utilities, transmission and distribution, and generation and marketing support earnings.

Equity investors have endured a roller-coaster start to 2025, with a positive January but a negative February. The S&P 500 is up a little over 1% year to date. Can March reverse the February fail and return the current 27-month-old bull market to an upward track? March historically had been a strong month for equities -- prior to 2020. The average gain for the S&P 500 in the month of March since 1980 is now 1.05%, after absorbing the COVID-induced plunge of 12.5% in 2020. March is thus in the middle of the pack (sixth place) in terms of average monthly gains, with a winning percentage of 64%. We note that market returns in March have exceeded 4% on seven occasions since 1980, including a 4.2% gain in 2021 on COVID-19 vaccination progress and a 6.6% advance in 2016 as the market was beginning to recover from the oil price spikes of 2014-2015. Last year, March was on the up and up, with a gain of 3.1%. But there have been some clunkers, including 1980 (-10%), 2001 (-6.4%), 1994 (-4.5%), 1997 (-4.3%), 1988 (-3.3%) and, as discussed above, 2020. March generally is a quiet month on Wall Street, as the fourth-quarter earnings reports are for the most part finished. Without profits to review, investors will be paying very close attention to economic reports, including the nonfarm payrolls report this Friday, the Consumer Price Inflation report on March 12, and the Federal Reserve's two-day meeting on March 18 and 19. No doubt tariff talk and geopolitics will play into market activity for the month as well. We maintain our forecast for a positive year for the S&P 500, with returns near the historical average.