Earnings Update: The Southern Company (NYSE:SO) Just Reported Its Yearly Results And Analysts Are Updating Their Forecasts

Investors in The Southern Company (NYSE:SO) had a good week, as its shares rose 3.3% to close at US$88.40 following the release of its annual results. Southern reported in line with analyst predictions, delivering revenues of US$27b and statutory earnings per share of US$3.99, suggesting the business is executing well and in line with its plan. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for Southern

After the latest results, the 13 analysts covering Southern are now predicting revenues of US$27.6b in 2025. If met, this would reflect a modest 3.2% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to accumulate 6.9% to US$4.29. In the lead-up to this report, the analysts had been modelling revenues of US$27.2b and earnings per share (EPS) of US$4.31 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$90.46. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Southern at US$104 per share, while the most bearish prices it at US$72.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Southern's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 3.2% growth on an annualised basis. This is compared to a historical growth rate of 6.3% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.3% annually. Factoring in the forecast slowdown in growth, it seems obvious that Southern is also expected to grow slower than other industry participants.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Southern's revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$90.46, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Southern going out to 2027, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 3 warning signs for Southern (1 is concerning!) that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.