| Snowflake Score | |
|---|---|
| Valuation | 1/6 |
| Future Growth | 1/6 |
| Past Performance | 2/6 |
| Financial Health | 2/6 |
| Dividends | 6/6 |
SO Overview
The Southern Company, through its subsidiaries, engages in the generation, transmission, and distribution of electricity.
Southern Competitors
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | US$64.14 |
| 52 Week High | US$52.01 |
| 52 Week Low | US$67.54 |
| Beta | 0.45 |
| 1 Month Change | -3.38% |
| 3 Month Change | 4.38% |
| 1 Year Change | 21.45% |
| 3 Year Change | 45.74% |
| 5 Year Change | 19.82% |
| Change since IPO | 340.45% |
Recent News & Updates
The Southern Company's (NYSE:SO) Intrinsic Value Is Potentially 25% Below Its Share Price
Today we will run through one way of estimating the intrinsic value of The Southern Company ( NYSE:SO ) by estimating...
Southern Company: A Utility With Bullish Fundamentals
Southern Company’s adjusted earnings grew in the second quarter as economic activity increased. The company continues to see a long-term EPS growth rate in the 5% to 7% range. Several top funds we track increased their positions for the filing period ended June 30, 2021.
The Southern Company: What To Expect Next?
My last articles performed analyses focusing on the specifics and ROCE of the Southern Company. This article reviews the return drivers in the past decade, and then provides an outlook for the next one. The results unfortunately suggest that it is unlikely that the past decade's performance can be repeated for the next one.
Shareholder Returns
| SO | US Electric Utilities | US Market | |
|---|---|---|---|
| 7D | -3.1% | -3.1% | -0.6% |
| 1Y | 21.5% | 16.2% | 33.8% |
Return vs Industry: SO exceeded the US Electric Utilities industry which returned 16.2% over the past year.
Return vs Market: SO underperformed the US Market which returned 33.8% over the past year.
Price Volatility
| SO volatility | |
|---|---|
| SO Beta | 0.45 |
| Industry Beta | 0.43 |
| Market Beta | 1 |
Stable Share Price: SO is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 2% a week.
Volatility Over Time: SO's weekly volatility (2%) has been stable over the past year.
About the Company
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 1945 | 27,839 | Tom Fanning | https://www.southerncompany.com |
The Southern Company, through its subsidiaries, engages in the generation, transmission, and distribution of electricity. It operates in four segments: Gas Distribution Operations, Gas Pipeline Investments, Wholesale Gas Services, and Gas Marketing Services. The company also constructs, acquires, owns, and manages power generation assets, including renewable energy and battery energy storage projects and sells electricity in the wholesale market; and distributes natural gas in Illinois, Georgia, Virginia, and Tennessee, as well as provides gas marketing services, wholesale gas services, and gas pipeline investments operations.
Valuation
Is Southern undervalued compared to its fair value and its price relative to the market?
21.58x
Price to Earnings (PE) ratio
Share Price vs. Fair Value
Below Fair Value: SO ($64.14) is trading above our estimate of fair value ($49.9)
Significantly Below Fair Value: SO is trading above our estimate of fair value.
Price To Earnings Ratio
PE vs Industry: SO is good value based on its PE Ratio (21.6x) compared to the US Electric Utilities industry average (21.8x).
PE vs Market: SO is poor value based on its PE Ratio (21.6x) compared to the US market (17.8x).
Price to Earnings Growth Ratio
PEG Ratio: SO is poor value based on its PEG Ratio (2.3x)
Price to Book Ratio
PB vs Industry: SO is overvalued based on its PB Ratio (2.4x) compared to the US Electric Utilities industry average (2x).
Future Growth
How is Southern forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?
9.5%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: SO's forecast earnings growth (9.5% per year) is above the savings rate (2%).
Earnings vs Market: SO's earnings (9.5% per year) are forecast to grow slower than the US market (14.9% per year).
High Growth Earnings: SO's earnings are forecast to grow, but not significantly.
Revenue vs Market: SO's revenue (3.5% per year) is forecast to grow slower than the US market (9.8% per year).
High Growth Revenue: SO's revenue (3.5% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: SO's Return on Equity is forecast to be low in 3 years time (13.2%).
Past Performance
How has Southern performed over the past 5 years?
16.7%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: SO has high quality earnings.
Growing Profit Margin: SO's current net profit margins (14.4%) are lower than last year (15.8%).
Past Earnings Growth Analysis
Earnings Trend: SO's earnings have grown by 16.7% per year over the past 5 years.
Accelerating Growth: SO's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: SO had negative earnings growth (-2.8%) over the past year, making it difficult to compare to the Electric Utilities industry average (1.6%).
Return on Equity
High ROE: SO's Return on Equity (9.4%) is considered low.
Financial Health
How is Southern's financial position?
Financial Position Analysis
Short Term Liabilities: SO's short term assets ($9.6B) do not cover its short term liabilities ($11.7B).
Long Term Liabilities: SO's short term assets ($9.6B) do not cover its long term liabilities ($81.2B).
Debt to Equity History and Analysis
Debt Level: SO's debt to equity ratio (157.6%) is considered high.
Reducing Debt: SO's debt to equity ratio has reduced from 166.6% to 157.6% over the past 5 years.
Debt Coverage: SO's debt is not well covered by operating cash flow (13%).
Interest Coverage: SO's interest payments on its debt are well covered by EBIT (3.1x coverage).
Balance Sheet
Dividend
What is Southern current dividend yield, its reliability and sustainability?
4.12%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: SO's dividend (4.12%) is higher than the bottom 25% of dividend payers in the US market (1.33%).
High Dividend: SO's dividend (4.12%) is in the top 25% of dividend payers in the US market (3.6%)
Stability and Growth of Payments
Stable Dividend: SO's dividends per share have been stable in the past 10 years.
Growing Dividend: SO's dividend payments have increased over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: At its current payout ratio (86.9%), SO's payments are covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: SO's dividends in 3 years are forecast to be covered by earnings (71.9% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
8.0yrs
Average management tenure
CEO
Tom Fanning (64 yo)
10.75yrs
Tenure
US$22,366,850
Compensation
Mr. Thomas A. Fanning, also known as Tom, has been the Chairman and Chief Executive Officer of The Southern Company since December 1, 2010 and its President of Southern Company since August 1, 2010. He ser...
CEO Compensation Analysis
Compensation vs Market: Tom's total compensation ($USD22.37M) is above average for companies of similar size in the US market ($USD11.36M).
Compensation vs Earnings: Tom's compensation has been consistent with company performance over the past year.
Leadership Team
Experienced Management: SO's management team is seasoned and experienced (8 years average tenure).
Board Members
Experienced Board: SO's board of directors are considered experienced (6.6 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: SO insiders have only sold shares in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
The Southern Company's employee growth, exchange listings and data sources
Key Information
- Name: The Southern Company
- Ticker: SO
- Exchange: NYSE
- Founded: 1945
- Industry: Electric Utilities
- Sector: Utilities
- Market Cap: US$67.913b
- Shares outstanding: 1.06b
- Website: https://www.southerncompany.com
Number of Employees
Location
- The Southern Company
- 30 Ivan Allen Jr. Boulevard, N.W.
- Atlanta
- Georgia
- 30308
- United States
Listings
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2021/09/18 22:03 |
| End of Day Share Price | 2021/09/17 00:00 |
| Earnings | 2021/06/30 |
| Annual Earnings | 2020/12/31 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.