AES Stock Rises 28.6% in 6 Months: What Should Investors Do?

The AES Corporation AES shares have gained 28.6% over the past six months compared with the Zacks Utility-Electric Power industry’s growth of 8.4%. The company is benefiting from its focus on expanding its renewable generation portfolio.  Image Source: Zacks Investment ResearchAES is well-positioned to capitalize on the growing electricity demand from data centers. Other utilities like NRG Energy NRG and Edison International EIX are also benefiting from the increased demand from data centers. NRG Energy entered into 445 MW of premium, long-term retail agreements to power data centers. Edison International is also expanding its renewable energy portfolio to meet the increasing demand. Shares of NRG and EIX have gained 5.2% and 22.5%, respectively, during the aforementioned period.Given the current outperformance in price, should you consider adding AES to your portfolio right now? Let's examine the factors in detail and assess the investment prospects.Factors Driving the Performance of AES StockAES is capitalizing on the global shift to renewable energy through investments in utility-scale renewables and energy storage, supported by innovation and artificial intelligence (AI) to accelerate clean-energy deployment. Its geographically diversified operations help stabilize revenues, while rising power demand from data centers driven by AI and cloud computing is creating strong growth opportunities.AES is well-positioned to capitalize on the growing electricity demand from data centers through its significant power purchase agreements (PPAs). The company currently has about 4.2 gigawatt (GW) of data center PPAs in operation and a total of 8.2 GW in signed agreements.AES Indiana plans to convert the remaining two coal units at Petersburg to natural gas. The company expects this project to be completed in 2026. It is also working to add new renewables and natural gas to the grid. All these decarbonization strategies adopted by the company will help in achieving its net-zero GHG emission target by 2050.AES is expanding its presence in the growing liquefied natural gas (“LNG”) market through strategic projects and infrastructure investments. Its Andres unit operates the Dominican Republic’s only LNG import terminal, supplying industrial users and power plants via long-term contracts. The company is also advancing major projects in Vietnam — the Son My LNG terminal and the 2,250-MW Son My 2 gas plant — which are expected to strengthen its global LNG footprint over the long term.A diversified portfolio of renewables, gas, LNG, and battery storage provides stability and flexibility, mitigating risks from fuel price fluctuations.AES Stock’s Earnings EstimateThe Zacks Consensus Estimate for AES’ 2026 earnings per share (EPS) indicates an increase of 8.44% year over year. AES’ long-term (three to five years) earnings growth rate is 11.17%. Image Source: Zacks Investment ResearchThe Zacks Consensus Estimate for NRG Energy’s 2026 EPS indicates an increase of 27.8% year over year. The Zacks Consensus Estimate for Edison International’s 2026 EPS indicates an improvement of 2.8% year over year. EIX’s long-term earnings growth rate is 10.93%.AES Stock’s Earnings Surprise HistoryThe company beat on earnings in two of the trailing four quarters and missed in the other two, delivering an average surprise of 14.68%. Image Source: Zacks Investment ResearchAES’ Dividend HistoryThe consistently strong performance of the company has enabled it to reward its shareholders through annual dividend rate hikes. On Dec. 5, 2025, its board of directors declared a quarterly common stock dividend of 17.595 cents per share. The company’s current dividend yield of 4.75% is better than the Zacks S&P 500 composite’s 1.41%. Check AES’ dividend history here.AES’ Debt Position & LiquidityCurrently, the company’s total debt to capital is 78.58%, higher than the industry’s average of 61.13%.  Image Source: Zacks Investment ResearchThe company’s current ratio is 0.72. A current ratio less than one indicates that the company's current liabilities are greater than its current assets, which means it may struggle to meet its short-term obligations.AES Stock’s ValuationThe company is currently trading at 6.27X, a discount compared to its industry’s 15.39X on a forward 12-month P/E basis. Image Source: Zacks Investment ResearchSumming UpAES is benefiting from strong and growing electricity demand from data centers, backed by a sizable PPA portfolio. The company is advancing decarbonization by shifting coal assets to natural gas and adding renewables to meet its net-zero 2050 goal, while also expanding its LNG footprint. However, the company’s higher debt ratio and lower current ratio are concerning at the moment. The investors can hold onto this Zacks Rank #3 (Hold) stock and enjoy the benefits of regular dividends and earnings growth estimates. The new investors can wait and look for a better entry point.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Zacks' Research Chief Picks Stock Most Likely to "At Least Double"Our experts have revealed their Top 5 recommendations with money-doubling potential – and Director of Research Sheraz Mian believes one is superior to the others. Of course, all our picks aren’t winners but this one could far surpass earlier recommendations like Hims & Hers Health, which shot up +209%.See Our Top Stock to Double (Plus 4 Runners Up) >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report NRG Energy, Inc. (NRG): Free Stock Analysis Report Edison International (EIX): Free Stock Analysis Report The AES Corporation (AES): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks