The Southern Company (SO), headquartered in Atlanta, Georgia, is a leading energy provider with a market cap of $97.1 billion. The company serves millions of customers across the southeastern U.S., delivering reliable and sustainable energy solutions.
Through its subsidiaries, Southern Company operates a diverse portfolio of electric utilities, natural gas distribution networks, and renewable energy projects, supporting residential, commercial, and industrial markets.
Shares of the utility firm have underperformed the broader market over the past year. The stock has gained 29.7% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 35.9%. However, in 2024, the stock is up 26%, compared to the SPX’s 25.8% rise on a YTD basis.
Narrowing the focus, SO has outperformed the Utilities Select Sector SPDR Fund (XLU). The exchange-traded fund has gained 25.4% on a YTD basis.
Southern Company has outperformed the broader market and its peers this year due to strong performance in its regulated utility business and successful execution of its growth strategy in renewable energy. The company's focus on expanding its renewable energy portfolio and commitment to sustainable practices have also contributed to its success in the market.
On Oct. 31, Southern Company reported its Q3 earnings results, and the stock gained 1.9%.The company’s revenue amounted to $7.27 billion, surpassing the Street estimates of $7.12 billion while, its EPS came in at $1.43, topping the Street forecasts of $1.33.
For the current fiscal year, ending in December, analysts expect Southern Company’s EPS to grow 10.7% to $4.04 on a diluted basis. Moreover, the company's earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.
Among the 21 analysts covering SO stock, the consensus rating is a “Moderate Buy.” That’s based on eight “Strong Buy” ratings, one “Moderate Buy,” eleven “Holds,” and one “Strong Sell.”
This configuration is slightly less bullish than three months ago, with nine suggesting a “Strong Buy.”
On Nov. 5, Shelby Tucker from RBC Capital maintained a ‘Buy’ rating on Southern Company with a price target of $96, which indicates a 8.7% upside from the current levels.
The mean price target is $93.47 represents a 5.8% premium to SO’s current price levels. The Street-high price target of $104 suggests an upside potential of 17.7%.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
