AES (NYSE:AES) Stock Price Up 5.5% - Should You Buy?

On Monday, shares of The AES Corporation (NYSE:AES) experienced a significant increase, surging by 5.5% during mid-day trading. The stock reached a peak of $15.64 before closing at $15.52. During the trading session, approximately 2,496,326 shares were exchanged, a notable decline from the average daily volume of 8,261,875 shares. The previous closing price was $14.71.

Wall Street Analyst Insights

AES has recently been the focus of various research reports from financial analysts. On September 11, Jefferies Financial Group began coverage of AES, assigning a "buy" rating and establishing a price target of $20.00 for the stock. Barclays also raised their price target from $22.00 to $23.00 in a report released on October 21, maintaining an "overweight" rating. Additionally, on September 18, Evercore ISI upgraded AES to a "strong-buy" rating. Currently, two analysts provide a hold rating, six offer buy ratings, and one rates the stock as a strong buy. According to MarketBeat.com, the average consensus rating for AES is classified as a "Moderate Buy," with an average price target set at $22.57.

AES Stock Performance Overview

The fifty-day simple moving average for AES stands at $17.85, while the 200-day simple moving average is at $18.30. Financial metrics indicate that the company has a debt-to-equity ratio of 3.63, alongside a current ratio of 0.97 and a quick ratio of 0.91. AES has a market capitalization of $10.86 billion and a price-to-earnings (P/E) ratio of 10.58, with a beta value of 1.10.

The latest quarterly earnings report from AES was released on October 31. The utility provider reported earnings per share (EPS) of $0.71, surpassing the consensus estimate of $0.60 by $0.11. The company recorded a net margin of 8.34% and a return on equity of 28.95%. AES generated $3.29 billion in revenue for the quarter, although this was below the expected $3.46 billion. In the corresponding quarter last year, AES disclosed an EPS of $0.60, with revenue for the latest quarter illustrating a 4.2% decline year-over-year. Analysts predict an EPS of 1.91 for the current fiscal year.

Dividend Announcement from AES

Furthermore, AES recently announced a quarterly dividend, which is set to be paid on November 15. Shareholders recorded as of November 1 will receive a dividend of $0.1725 per share. The ex-dividend date is also November 1. This dividend translates to an annualized amount of $0.69, yielding a dividend yield of 4.52%. Currently, AES maintains a payout ratio of 47.92%.

Institutional Investor Activity

Several institutional investors and hedge funds have altered their stakes in AES recently. For instance, Norden Group LLC increased its position in AES by 80.3% in the first quarter, accumulating 27,902 shares valued at $500,000 after adding 12,429 shares during the period. Mirae Asset Global Investments Co. Ltd. saw an even larger increase, boosting its holdings by 316.7% in the same quarter, with total ownership of 325,872 shares worth $5,843,000 post a purchase of 247,663 additional shares. BNP Paribas Financial Markets also increased their holdings in AES by 33.3%, now owning 794,793 shares valued at $14,251,000. Janney Montgomery Scott LLC significantly raised its AES stake by 729.0%, and Tokio Marine Asset Management Co. Ltd. increased its ownership by 10.2%. A substantial 93.13% of AES shares are held by institutional investors and hedge funds.

AES Company Overview

The AES Corporation operates worldwide as a diversified power generation and utility company. It owns and operates power plants to generate electricity for various customers, including utilities and industrial users. AES also provides utilities that generate, purchase, distribute, and sell electricity to residential, commercial, industrial, and governmental end-users, and sells electricity in wholesale markets.

Is Now a Good Time to Invest in AES?

Before deciding to invest in AES, it is worth noting that while analysts maintain a "Moderate Buy" rating, there are several other stocks that top analysts suggest are better investment opportunities. Sector trends, investor behavior, and market conditions should also be considered before making any investment choice.

AES, Stock, Investment