Analysts expect a decent upside potential from AES (AES) going forward. They have given AES a median target price of $18.3 compared to its current market price of $16.8, which suggests an estimated upside of 9.4% for the next 12 months.
Among the ten analysts tracking AES, four recommended a “buy,” one recommended a “strong buy,” and five recommended a “hold” as of June 24. Bank of America Merrill Lynch raised AES’s rating to “neutral” from “underperform” on June 20. Bank of America Merrill Lynch also raised AES’s target price from $16.0 to $16.5.
AES stock is trading at a dividend yield of 3.3%, which is in line with the peer average. In the last five years, AES raised its dividends ~27% compounded annually. AES started paying dividends in 2012. Utilities (XLU) at large managed dividend growth of ~4% during the same period.
AES stock is trading at a forward PE ratio of 12x, which is lower than the peer average. The ratio is also lower than AES’s historical average. AES has rallied more than 15% in 2019—in line with its peers. Utilities are trading at an average forward PE ratio of ~18x. AES looks attractive based on its valuation.
Read Which Utility Stocks Have the Highest Dividend Yields Right Now? to learn more.