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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
The Aes Corporation (XNYS:AES) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
AES
Name:
THE AES CORPORATION (XNYS:AES)
Sector:
- 309000.00K
Industry:
Utilities�Diversified
CEO:
Dr. Andres Gluski
Total Employees:
8,450
Our Technological Advancement Rating
Our Rating:
A+
Technological advancement compared to industry is 2103.37% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF THE AES CORPORATION(AES) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND UTILITIES�DIVERSIFIED INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
26.15
One Month Price Target:
$26.28
Six Month Price Target :
$26.93
Likely Price in One Year's Time:
Ticker:
$27.72
Likely Trading Range Today Under (Normal Volatility)
$26.05
Price Upper limit ($) :
$26.29
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$24.71
This week:
$22.93
This month :
$19.7
Other Primary facts
Market Cap:
17.40B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
667.93M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
14.96%
-17.3%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$32.84
$29.75
$19.46
$22.55
Medium risk (<10%) entry points
Buy Call
Sell Call
$28.74
Buy Put:
Sell Put:
$28.08
$23.55
$24.22
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
AES
Sharpe Ratio:
2.79%
Comparison:
AES, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 62.57% higher than the industry
& ratio is 22.27% higher than the market/S&P 500 average
Average Returns/Yield of
AES
Daily returns:
0.08%
Weekly returns:
0.42%
Monthly returns:
1.70%
Yearly returns:
11.80%
Comparison of returns:
Average annual returns/yield (last 3 years) is 72.47% above industry average
Classification:
AES, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
1
Statistical test of Returns:
AES has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.73%
Weekly Volatility:
6.10%
Monthly Volatility:
12.19%
Yearly Volatility:
42.23%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.84%
Volatility in last five trading days has been -69.06% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.51%
Weekly VaR:
-12.33%
Monthly VaR:
-24.66%
How Much Can the price of
AES
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-21%
Worst case (decline):
-85.43%
This translates to price declining to:
$20.70
This translates to price declining to:
$3.81
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
AES is a 74.05% riskier investment compared to the market/S&P 500 & is 49.11% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 21.45% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
AES
Beta in relation to market/S&P 500--0.89
Expected beta in 1 year's time:
0.627
Expected beta in 3 year's time:
0.886
Unlevered (debt free) Beta:
0.141
Beta in relation to Nasdaq (XNAS):
0.869
Beta in relation to all global stocks::
0.858
Beta Comparison & Analysis
Beta of competitors/peers::
0.593
Beta is 50.38% higher than peers
Average Industry Beta:
0.572
Beta is 55.83% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
4.33%
Sustainable growth rate is -7.54% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.111
Alpha is 134.44% above industry average alpha yield
Alpha is 707% higher than market/& is unsustainably high
Analysis of Cost of Capital of
AES
Equity cost of capital:
0.093
Equity cost of capital is 30.95% above industry mean WACC
Unlevered (without debt) cost of capital:
1.46%
Before-tax cost of debt:
4.83%
After-tax cost of debt:
3.82%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.82%
WACC is 3.74% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$17.00
Revenue growth rate per share of (3Y):
5.74
Annual revenue growth rate is -36.59% below industry average
EPS:
-$0.43
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
-
Balance sheet equity growth per share: 17.25%
Equity growth rate per share is 1137.74% higher than the industry
Debt per share
$26.95
EBITDA per share
$2.70
Valuation Analysis Today of
AES
P/E Ratio:
0
P/E Ratio of Competitors/Peers:
22.31
P/E ratio is -100.00% lower than main peers & is higher than the industry
-
AES is -185.02% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $18.72
Present value of the expected future dividends only: $8.06
P/S (Price to Sales ratio):
1.54
Price to sales ratio is -48.85% below the industry mean
P/B (Price to book value ratio):
5.74
-
-
Net income growth rate (3Y):
-134.20%
Net income growth rate is 321.34% higher than the average industry net income growth rate
Dividend Analysis
Dividend payout rate: -22.60%
Dividend yeild: 2.36%
Previous Dividend: $0.16
Previous adjusted dividend: $0.16
Previous Dividend: $0.62
Expected next dividend best case: $0.16
Expected next dividend worst case: $0.15
Average dividend payment (long-term): $0.15
Average dividend increase/decrease (growth rate) % per period: 1.50%
Expected next dividend payment date: 08/11/2022
Expected next dividend record date: 28/07/2022
Expected next dividend declaration date: 26/05/2022
Previous dividend payment date: 13/05/2022
Previous dividend record date: 29/04/2022
Previous dividend declaration date: 25/02/2022
Dividend History:
2022-04-28--$0.16
2021-11-01--$0.15
2021-04-29--$0.15
2022-01-31--$0.16
2021-07-30--$0.15
2021-01-28--$0.15
Dividend growth rate is -50.01% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
591.26%
Net debt to equity ratio:
630.62%
Debt to assets ratio:
51.95%
Net debt to assets ratio:
55.40%
Debt-to-asset ratio is -22.01% below industry average
Ability to repay debt:
Interest coverage ratio:
1.84
Interest coverage ratio is -40.16% less than industry average
Looking forward:
Debt growth rate:
-5.95%
Annual debt growth is -106% lower than industry average debt growth rate
Debt repayment rate in last quarter: 4.34%
Analysis of Key Statistics
Correlation of price movement with the market:
0.652
Statistical significance of correlation:
AES has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.609
Stock price is 6.98% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.609
Correlation of price movement with Nasdaq (^IXIC):
0.009
Covariance of price movement with the market:
0.015
Kurtosis
7.78
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.605
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
AES
Gross Profit Margin Ratio:
72%
Operating Profit Margin Ratio:
17.06%
Operating profit margin is 142.96% higher than the industry
Net Profit Margin Ratio:
72%
Effective Tax Rate:
10.01%
Effective tax rate is -68.98% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-4.80%
Return on equity (ROE) is -160.13% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
-0.42%
Return on assets (ROA) is -119.66% lower than the industry
Financial Leverage:
2.1x
Current Ratio:
1.07
Current ratio is -74.11% below industry average
Cash Conversion Cycle (days):
3
Cash conversion cycle is -96.11% below industry average
The remaining useful life of property plant & equipment is: 3.4 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
1.3M
Each employee generates 51% more revenue than industry average revenue per employee
EBITDA generated per employee:
213.4K
Each employee generates 0% more EBITDA than industry average revenue per employee
Profit generated per employee:
- 17.3K
Each employee generates -136% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 36.6K
Each employee generates 125% more free cash flow than industry average revenue per employee
Assets/Capital per employee
3.4M
Each employee generates 125% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
AES
Evergy, Inc. (XNYS:EVRG)
Energy Company of Parana (XNYS:ELP)
ATMOS ENERGY CORPORATION (XNYS:ATO)
CNP-PB
Essential Utilities, Inc. (XNYS:WTRG)
DUKH
BROOKFIELD INFRASTRUCTUR PARTNER UNT (XNYS:BIP)
Enel Americas SA (OTCM:ENIAY)
CMS ENERGY CORPORATION (XNYS:CMS)
Current Analyst Ratings
Strong buy�4%
Buy�17%
Hold�17%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
11.36B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
6.46B
2.05B
-
172.00M
172.00M
-
-
172.00M
305.00M
979.00M
1.05B
1.80B
1.94B
- 146000.00K
- 809000.00K
- 81000.00K
- 146000.00K
Statement of Cash Flow
Date:
Period:
270.00M
Differed Income Tax :
- 7000.00K
Stock Based Compensation :
-
Change in Working Capital :
23.00M
Accounts Receivables:
- 77000.00K
Other Working Capital:
-
Other Non-Cash Items:
-
Net Cash Provided by Operating Activities:
457.00M
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
- 345000.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
1.06B
440.00M
1.50B
1.52B
688.00M
2.44B
6.14B
20.45B
1.18B
1.59B
1.08B
385.00M
3.82B
28.51B
-
34.65B
1.29B
2.25B
294.00M
-
2.21B
5.75B
18.00B
4.01B
23.05B
48.90B
31.60B
8.00M
- 974000.00K
- 1899000.0K
5.91B
March 31, 2022 at 6:00:00 AM
6.58B
3.04B
34.65B
1.52B
20.25B
19.2B
197.00M
- 1005000.00K
- 1153000.00K
- 817000.00K
-
-
- 33000.00K
1.67B
818.00M
20.00M
78.00M
1.56B
1.48B
457.00M
- 766000.00K
- 309000.00K
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
AES
2023
2024
2025
2026
2027
$21.86
$23.16
$24.55
$26.02
$27.58