AEP falls on pricing $2.6 bln share offering

Electric utility American Electric Power AEP..O shares down 3.7% before the bell to $127.08 after $2.6 bln follow-on priced

Columbus, Ohio-headquartered AEP late Tues announced ~20.47 mln shares at $127 with forward sale component

Offering price represents 3.7% discount to stock's last close

AEP entered into 2-year forward sale agreements with bookrunners BofA, Goldman Sachs and Morgan Stanley

Upon settlement of agreements, it plans to use net proceeds for general purposes, including capital contributions to utility subsidiaries, acquisitions and potential debt repayment

The forward sale enables the utility to lock in funding at current prices but delays new share issuance and earnings dilution until the proceeds are needed

Prior to offering, co had ~544.1 mln shares outstanding for $71.8 bln market cap

AEP last week raised its five-year capital investment plan to $78 bln as data center demand surges

Through Tues, shares up ~14% YTD and outperforming nearly 6% advance in S&P 500 Utilities sector .SPLRCU

Avg rating of 24 analysts is "buy"; median PT $144.50, latest LSEG data shows