How Can I Beat the S&P 500? What the Evidence Says
The honest answer to the most asked question in investing: how many people beat the index, why it is so hard, why investors trail even their own funds, and how daily market context fits in.
American Electric Power Company, Inc., utilities (market value $69.4 billion), a member of the S&P 500 and the Nasdaq‑100: how it compared with the S&P 500, how it behaved in every crash since 2008, its risk‑adjusted returns and what analysts said. Data as of Sep 30, 2026.
Exent re-checks this page every day. Ratings appear 30 days after they are published; the top‑ranked analysts’ calls are not counted here, they are in Gems.
What do the best‑ranked analysts on AEP say now? See it in Exent Gems →
Over the 5 years to Sep 30, 2026, American Electric Power Company, Inc. (AEP) returned +73.6% including dividends, versus +90.0% for the S&P 500 (SPY). It lagged the index by 16.4 percentage points, or +11.7% a year against +13.7%.
| Period | AEP | S&P 500 | AEP per year | S&P 500 per year | Result |
|---|---|---|---|---|---|
| 1 year | +7.9% | +15.7% | +7.9% | +15.7% | Lagged |
| 3 years | +74.4% | +85.0% | +20.4% | +22.8% | Lagged |
| 5 years | +73.6% | +90.0% | +11.7% | +13.7% | Lagged |
| 10 years | +158.1% | +312.9% | +9.9% | +15.2% | Lagged |
Total return with dividends reinvested, from month-end prices to Sep 30, 2026. Beating the index on raw return is only half the story: the next section adjusts for the risk taken. See also how to beat the S&P 500.
AEP is in the S&P 500 and the Nasdaq‑100 (members as of Oct 20, 2026); the lists show every member’s return against the index.
In the 12 months to 30 days ago, 22 analysts published 193 ratings on AEP. Their latest calls were 58% Buy, 42% Hold and 0% Sell. 10 of them rank 4★ or higher in Exent’s analyst scoring, which is based on each analyst’s past price‑target hit rate and returns.
The consensus 12‑month price target was $137.47 (range $122.00–$153.00), +7.9% from the last price. Remember that the average analyst’s target is hit only about half the time: how accurate are price targets?
| Top‑ranked analyst covering | Firm | Stars | Price‑target hit rate |
|---|---|---|---|
| ??? | ??? | 4.8★ | 47.5% |
| ??? | ??? | 4.8★ | 60.4% |
| ??? | ??? | 4.8★ | 26.6% |
| ??? | ??? | 4.8★ | 38.7% |
| ??? | ??? | 4.8★ | 59.3% |
Ratings are shown with a 30‑day delay. Who the top‑ranked analysts on AEP are, their live calls and the median target of only the top‑rated analysts are in Exent Gems.
The average analyst’s target is reached about 53.6% of the time; Exent Gems is built on the top 50 of Exent’s ranking,where some reached 90% or more over the last two years. Unlock the top 50 analysts.
AEP beat the S&P 500 in 3 of the 9 full calendar years shown.
| Year | AEP | S&P 500 | Difference |
|---|---|---|---|
| 2026 (to Sep 30, 2026) | +4.5% | +12.7% | −8.2% |
| 2025 | +29.4% | +17.7% | +11.7% |
| 2024 | +18.2% | +24.9% | −6.7% |
| 2023 | −11.0% | +26.2% | −37.2% |
| 2022 | +10.4% | −18.2% | +28.6% |
| 2021 | +10.7% | +28.7% | −18.0% |
| 2020 | −9.0% | +18.3% | −27.3% |
| 2019 | +30.5% | +31.2% | −0.7% |
| 2018 | +5.4% | −4.6% | +10.0% |
| 2017 | +19.9% | +21.7% | −1.8% |
Over 5 years, AEP had a Sharpe ratio of 0.48 against 0.67 for the S&P 500, so it earned less return per unit of risk than the index. Its annualized volatility was 19.6% and its beta 0.48: it tended to move about 0.5× as much as the market.
| Metric | AEP | S&P 500 |
|---|---|---|
| Annual return | +11.7% | +13.7% |
| Volatility (annualized) | 19.6% | 15.7% |
| Sharpe ratio | 0.48 | 0.67 |
| Sortino ratio | 0.76 | 1.08 |
| Max drawdown (month-end) | −22.8% | −23.9% |
| Beta to the S&P 500 | 0.48 | 1.00 |
Sharpe divides return above cash by total volatility; Sortino counts only downside volatility. Both use monthly returns and the 1–3 month T‑bill ETF (BIL) as the risk‑free rate.
AEP’s deepest fall in the crises below was −50.8% in the global financial crisis (2007–09), against −56.5% for the S&P 500. The last column turns that into money: what a $100,000 position would have lost from peak to trough.
| Crisis | AEP | S&P 500 | Loss on $100,000 |
|---|---|---|---|
| Global financial crisis (2007–09) | −50.8% | −56.5% | −$50,760 |
| 2018 trade-war selloff | −8.5% | −20.2% | −$8,470 |
| COVID crash (Feb–Mar 2020) | −32.4% | −34.1% | −$32,370 |
| 2022 inflation bear market | −22.3% | −25.4% | −$22,290 |
| 2025 tariff selloff | −7.3% | −19.0% | −$7,310 |
| Window | AEP max drawdown |
|---|---|
| Last 1 year | −14.8% |
| Last 3 years | −14.8% |
| Last 5 years | −29.6% |
| Last 10 years | −32.9% |
Peak‑to‑trough declines from daily prices inside each crisis window. A crash replay does not predict the next crisis; it shows how much room a holding needs. Run the same replay on a whole portfolio with the crash test.
Correlation runs from −1 (moves opposite) to +1 (moves in lockstep). Over the last 60 months of monthly returns, AEP’s correlation with the S&P 500 was 0.38, with the Nasdaq‑100 0.21, with long Treasuries (TLT) 0.47 and with gold (GLD) 0.28.
Adding a 5% AEP position to an S&P 500 portfolio would have moved its 5‑year volatility from 15.7% to 15.3%.
| Least correlated large caps | Correlation | Most correlated large caps | Correlation |
|---|---|---|---|
| NOW | −0.27 | DUK | 0.83 |
| CRWD | −0.26 | SO | 0.74 |
| PANW | −0.19 | WELL | 0.69 |
| CRM | −0.19 | KO | 0.60 |
| SNOW | −0.17 | NEE | 0.56 |
Holdings that are highly correlated behave like one position in a selloff. See how to find hidden overlap.
No named analyst changed a rating or price target on AEP in the 5 weeks to Sep 22, 2026 (calls are shown 30 days after publication). The top‑ranked analysts’ calls are in Exent Gems. See all of the latest analyst upgrades and downgrades.
Of the 337 analyst price targets on AEP set from 2019 until a year ago, 67.4% were reached within 12 months (data to Oct 20, 2026), 1.2 points below the 68.6% hit rate of the median stock in Exent’s study of 794 stocks. Targets that were reached took a median of 63 days. The median target sat 8.9% above the share price on the day it was set.
Where analysts said AEP would be by now: a year ago, 8 analysts had a price target on AEP, and the median of their latest targets was $130.00. On Oct 20, 2026 AEP closed at $127.22, 2.1% below it.
| After | Calls | Move on the call | 3 months vs S&P 500 |
|---|---|---|---|
| Upgrades of AEP | 18 | +0.3% | −3.1% |
| Upgrades, all stocks | 11,514 | +2.5% | +3.4% |
| Downgrades of AEP | 22 | −0.2% | +0.4% |
| Downgrades, all stocks | 10,700 | −3.0% | −1.6% |
The move on the call runs from the close before the rating change to the close after it; the last column is the stock’s return minus the S&P 500’s over the next three months. Averages of rating changes on AEP through Sep 15, 2026; analysts are not named here. Do analyst upgrades move stocks?
AEP beat the consensus earnings‑per‑share estimate in 8 of its last 12 quarterly reports, through the one on Jul 30, 2026, and the revenue estimate in 7 of 12. From the close before each report to the close after it, the stock moved 2.7% on average, up or down, against 6.8% for the average report across the 1,002 US stocks Exent tracks. It rose after 7 of the 12 reports. In 2 of the 8 beats the stock still fell. The next report is expected on Oct 28, 2026.
| Report | EPS vs estimate | Revenue vs estimate | Stock move |
|---|---|---|---|
| Jul 30, 2026 | $1.36 vs $1.48 | +1.9% | −1.2% |
| May 5, 2026 | $1.64 vs $1.57 | +5.3% | −1.6% |
| Feb 12, 2026 | $1.19 vs $1.15 | +8.7% | +6.3% |
| Oct 29, 2025 | $1.80 vs $1.81 | +5.2% | +5.9% |
| Jul 30, 2025 | $1.43 vs $1.27 | +2.5% | +3.6% |
| May 6, 2025 | $1.54 vs $1.40 | +5.8% | 0.0% |
| Feb 13, 2025 | $1.24 vs $1.25 | −4.3% | −0.5% |
| Nov 6, 2024 | $1.85 vs $1.80 | −0.3% | −4.1% |
Reported earnings per share against the consensus estimate, revenue surprise in percent, and the stock’s price change over the two sessions around the report. How stocks move after earnings
In fiscal 2025, AEP’s largest segment was Transmission And Distribution Companies, with 65.4% of $9.3 billion revenue (+3.7% on the year before).
| Segment | Revenue | Share | Growth |
|---|---|---|---|
| Transmission And Distribution Companies | $6.1 billion | 65.4% | +3.7% |
| Generation And Marketing | $2.7 billion | 28.9% | +38.7% |
| Product and Service, Other | $526.0 million | 5.6% | +8.9% |
From AEP’s annual filings; segment growth compares fiscal 2025 with the year before. Regions are as each company reports them, so one company’s “Asia Pacific” is not another’s. China counts the regions a company reports as China, Greater China or Hong Kong; a separately reported Taiwan is not counted. Which S&P 500 companies depend most on China?
As of Oct 20, 2026, 15 members of Congress had disclosed 34 trades in AEP (16 buys and 18 sales) in STOCK Act disclosures filed with the House and Senate. The latest public trade is dated Aug 26, 2026.
| Trade date | Member | Type | Amount |
|---|---|---|---|
| Aug 26, 2026 | David Taylor | Buy | $1,001–$15,000 |
| Jun 5, 2026 | David Taylor | Buy | $1,001–$15,000 |
| Feb 26, 2026 | David Taylor | Sale | $1,001–$15,000 |
| Jan 16, 2026 | David Taylor | Buy | $1,001–$15,000 |
| Nov 3, 2025 | David Taylor | Sale | $1,001–$15,000 |
| Oct 6, 2025 | Rick Larsen | Buy | $1,001–$15,000 |
| Sep 22, 2025 | David Taylor | Buy | $1,001–$15,000 |
| Mar 24, 2025 | George Whitesides | Sale | $15,001–$50,000 |
| Mar 10, 2025 | David Taylor | Sale | $1,001–$15,000 |
| Dec 6, 2024 | Virginia Foxx | Buy | $1,001–$15,000 |
Amounts are the ranges members report, not exact values. The STOCK Act gives members up to 45 days to disclose a trade, so trades appear weeks after they are made. See every member’s disclosed trades
One trade in AEP disclosed in the last 30 days is in Exent Radar.
In the 12 months to Oct 20, 2026, AEP insiders made no open‑market purchases and 7 sales worth $2.2 million, according to SEC Form 4 filings. The last open‑market purchase on record was on May 26, 2016.
After the 4 insider purchases of $10,000 or more since 2012, AEP lagged the S&P 500 by an average of 7.5 percentage points over the next 12 months; none of them was followed by a beat (a small sample). Across all 17,865 insider purchases in Exent’s study, the average was +17.2% and the median +1.0% against the index.
| Date | Insider | Role | Value |
|---|---|---|---|
| May 26, 2016 | McCullough Mark C | Executive Vice President | $284,660 |
| May 25, 2016 | McCullough Mark C | Executive Vice President | $284,737 |
| Feb 20, 2013 | Richard Oliver G Iii | Director | $99,930 |
| Nov 13, 2012 | Lin Sandra Beach | Director | $41,557 |
| Aug 5, 2011 | Cordes James F | Director | $71,675 |
The table lists the latest open‑market purchases on record, leaving out the last 30 days. The chart counts Form 4 purchases and sales by calendar quarter. Purchases are open‑market buys; sales include planned sales under 10b5‑1 trading plans. Do insider buys beat the market?
As of the Sep 30, 2026 settlement date, 5.42% of AEP’s float was sold short: 29.5 million shares, or 6.3 days of average trading volume to cover. A year earlier (Oct 15, 2025) it was 4.16%. The median across the 997 US stocks Exent tracks was 4.77%, so AEP is more heavily shorted than most.
From FINRA short‑interest reports, filed twice a month; the bars show the short share of the float at each month‑end. Days to cover divides the shares short by the average daily volume. The most shorted stocks
At the end of Q2 2026 (Jun 30, 2026), 2,035 institutions reported holding AEP in 13F filings, up 39 from the quarter before and up from 1,699 a year earlier. Their reported holdings add up to 92.9% of AEP’s shares. In the quarter 1,063 institutions added to their positions and 598 cut them.
Investment managers with over $100 million in US equities file 13F reports within 45 days of each quarter end, so this is the latest complete quarter. Holdings can add up to more than 100% when shares are lent and counted twice. Which stocks institutions are buying and selling
AEP’s diluted share count rose 4.6% over the five fiscal years to fiscal 2025 and fell 2.1% in fiscal 2025 alone. Each share now owns a smaller slice of the company. The median change across the 1,005 US stocks Exent tracks was −0.1%.
AEP did not buy back shares in fiscal 2025.
Weighted‑average diluted shares from AEP’s annual income statements; stock‑based compensation and buybacks from its cash‑flow statement. Stock dilution and stock‑based compensation, explained
In Exent’s Oct 20, 2026 snapshot, AEP’s Altman Z‑score was 0.90, in the distress zone (where 180 of the 794 non‑financial US stocks Exent tracks sit). Its Piotroski F‑score was 5 out of 9; 80% of scored stocks reach 5 or more.
The Altman Z‑score combines five balance‑sheet and earnings ratios into one bankruptcy‑risk score: below 1.81 is the distress zone, 1.81–2.99 grey, above 2.99 safe. It is not meaningful for banks, insurers and REITs. The Piotroski F‑score counts nine yes/no tests of profitability, leverage and efficiency; 8–9 is strong, 0–2 weak. Both come from the latest annual statements. Which stocks have the highest bankruptcy risk?
On its latest earnings call (Jul 30, 2026), AEP’s executives and analysts did not mention AI, against 1 on the call before (May 5, 2026); the average across 455 S&P 500 calls that quarter was 12.9. After AI, the most mentioned topic was tariffs (6).
| Mentions | Jul ’26 | May ’26 | Feb ’26 | Oct ’25 |
|---|---|---|---|---|
| AI | 0 | 1 | 2 | 1 |
| AI agents | 0 | 0 | 0 | 0 |
| Data centers | 1 | 9 | 13 | 9 |
| Tariffs | 6 | 6 | 7 | 4 |
| China | 0 | 0 | 0 | 0 |
| Recession | 0 | 0 | 0 | 0 |
Word counts in the full transcript of each call, prepared remarks and Q&A, newest first. “AI” also counts generative AI and large language models; “AI agents” counts agentic AI. Which companies talk most about AI?
As of Oct 20, 2026, 57 of the 304 ETFs Exent tracks held AEP. Its largest weight is in XLU (State Street Utilities Select Sector SPDR ETF), at 5.22% of the fund.
| ETF | Fund | Weight of AEP |
|---|---|---|
| XLU | State Street Utilities Select Sector SPDR ETF | 5.22% |
| FUTY | Fidelity MSCI Utilities Index ETF | 4.71% |
| VPU | Vanguard Utilities Index Fund ETF Shares | 4.67% |
| JXI | iShares Global Utilities ETF | 3.19% |
| IGF | iShares Global Infrastructure ETF | 1.94% |
| FDVV | Fidelity High Dividend ETF | 1.11% |
| VOE | Vanguard Mid-Cap Value Index Fund | 1.10% |
| DVY | iShares Select Dividend ETF | 0.94% |
Owning several of these funds stacks the same position. How much do VOO, QQQ and VTI overlap?
William J. Fehrman, AEP’s President and Chief Executive Officer, received total pay of $36.6 million for fiscal 2025, up 176.1% from $13.3 million for fiscal 2024, according to the company’s proxy statement filed with the SEC on Mar 18, 2026. 80% of it came as stock and option awards, valued when they were granted rather than when they pay out. The median CEO pay across the 378 S&P 500 companies Exent tracks was $17.2 million, so AEP’s CEO earned 2.1 times as much.
| Pay component | Amount | Share of total |
|---|---|---|
| Salary | $1.5 million | 4.1% |
| Bonus | $1.1 million | 3.1% |
| Stock and option awards | $29.3 million | 80.2% |
| Incentive plan (cash) | $4.3 million | 11.7% |
| Other | $315,973 | 0.9% |
| Other top executives | Role | Total pay, 2025 |
|---|---|---|
| Trevor I. Mihalik | Executive Vice President and Chief Financial Officer | $13.5 million |
| Douglas A. Cannon | President - AEP Transmission | $6.7 million |
| Robert B. Berntsen | Executive Vice President, General Counsel, and Secretary | $5.5 million |
| Alicia R. Knapp | President - Nuclear Development | $4.4 million |
Figures from the summary compensation table of the proxy statement; awards count at their grant‑date value, so one large multi‑year grant can make a single year stand out. CEO pay across the S&P 500
Exent matches every holding to the index with the most similar risk. For AEP that is SPY (the S&P 500). Comparing a holding with an index that carries very different risk makes good results look bad and risky ones look clever. Read why the S&P 500 is the wrong benchmark for most portfolios.
Returns are total returns from month‑end adjusted closing prices (dividends reinvested) through Sep 30, 2026. Crisis drawdowns and trailing maximum drawdowns use daily prices. Analyst coverage counts ratings published in the last 12 months, shown with a 30‑day delay. Full method: Exent methodology.
Company data as of Oct 20, 2026. The move around an earnings report runs from the close before it to the close after it; a price target counts as hit when the stock closed at or beyond it within 12 months (Exent analyst data). Revenue by region and segment, share counts and executive pay come from company filings; insider trades from SEC Form 4, short interest from FINRA, institutional ownership from 13F filings, Congress trades from STOCK Act disclosures filed with the House and Senate, federal contracts from USAspending.gov. Filings from the last 30 days are shown as counts only.
Past performance does not guarantee future results. Historical figures are calculated by Exent from market data and are for education only; they are not investment advice or a recommendation to buy or sell any security.
Wall Street’s average AEP price target is 7.9% above the latest share price. See what the best‑ranked analysts on AEP say now in Exent Gems.
No. AEP returned +158.1% (+9.9% a year) over the 10 years to Sep 30, 2026, versus +312.9% (+15.2% a year) for the S&P 500, including dividends.
Yes. As of Oct 20, 2026, AEP (American Electric Power Company, Inc.) is one of the 503 stocks in the S&P 500. It is also in the Nasdaq-100.
Yes. As of Oct 20, 2026, AEP (American Electric Power Company, Inc.) is one of the 101 stocks in the Nasdaq-100.
AEP fell −50.8% from peak to trough during the global financial crisis (2007–09), versus −56.5% for the S&P 500.
AEP fell −32.4% from peak to trough during the covid crash (feb–mar 2020), versus −34.1% for the S&P 500.
AEP fell −22.3% from peak to trough during the 2022 inflation bear market, versus −25.4% for the S&P 500.
Over the 5 years to Sep 30, 2026, AEP’s Sharpe ratio was 0.48 and its Sortino ratio 0.76, versus 0.67 and 1.08 for the S&P 500.
AEP’s 5‑year annualized volatility was 20.2%, higher than the S&P 500’s 17.0%, with a beta of 0.48.
Among large US stocks, the lowest correlations with AEP over the last 60 months were NOW (−0.27), CRWD (−0.26), PANW (−0.19). Its correlation with long Treasuries (TLT) was 0.47 and with gold (GLD) 0.28.
AEP beat the consensus earnings-per-share estimate in 8 of its last 12 quarterly reports through Jul 30, 2026, and the revenue estimate in 7 of 12. The stock moved 2.7% on average, up or down, from the close before each report to the close after it. Its next report is expected on Oct 28, 2026.
William J. Fehrman, AEP’s President and Chief Executive Officer, received $36.6 million in total pay for fiscal 2025, including a $1.5 million salary and $29.3 million in stock and option awards valued at grant, according to the proxy statement filed with the SEC on Mar 18, 2026. The median S&P 500 CEO received $17.2 million.
Yes. As of Oct 20, 2026, 15 members of Congress had disclosed 34 trades in AEP (16 buys and 18 sales) in STOCK Act disclosures filed with the House and Senate.
As of the Sep 30, 2026 settlement date, 5.42% of AEP’s float was sold short (29.5 million shares, 6.3 days to cover), according to FINRA short-interest reports. A year earlier it was 4.16%.
Yes. AEP’s diluted share count rose 4.6% over the five fiscal years to fiscal 2025 and fell 2.1% in the latest year. Stock-based compensation was 0.0% of revenue.
Exent ranks Wall Street analysts by their track record. Gems shows who the top‑ranked analysts on AEP are, their latest calls and the stocks where several of them agree.
Educational content, not investment advice. Examples are illustrative; past performance does not guarantee future results.