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Southern Co
(NYSE:SO)
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Rating:66Neutral
Price Target:
$104.00
â–²(10.04% Upside)
Action:Reiterated
Date:05/01/26
The score is driven primarily by stable but constrained financials (negative free cash flow and high leverage) and a strong, upbeat earnings-call backdrop (EPS beat, accelerating large-load/data-center demand, and meaningful pipeline/financing progress). Technical signals are mixed and valuation is supported by the dividend but limited by a higher P/E for the sector.
Positive Factors
Regulated utility revenue model
A predominantly regulated business model provides predictable cash flows and allowed returns tied to rate base, insulating revenues from commodity volatility. Over 2–6 months this underpins stable revenue recovery for capex and supports creditability with regulators and customers.
Negative Factors
Elevated leverage and negative free cash flow
High debt relative to equity and recurring negative free cash flow constrain financial flexibility and increase refinancing and interest-rate sensitivity. Over the medium term this limits ability to self-fund growth, raises reliance on external capital, and pressures credit metrics.
Read all positive and negative factors
Positive Factors
Negative Factors
Regulated utility revenue model
A predominantly regulated business model provides predictable cash flows and allowed returns tied to rate base, insulating revenues from commodity volatility. Over 2–6 months this underpins stable revenue recovery for capex and supports creditability with regulators and customers.
Read all positive factors
Southern Co Key Performance Indicators (KPIs)
Any
Kilowatt-Hour Sales by Segment
Monitors electricity sales across different customer segments, highlighting demand trends and potential growth areas within residential, commercial, or industrial markets.
Monitors electricity sales across different customer segments, highlighting demand trends and potential growth areas within residential, commercial, or industrial markets.
Data provided by:
The Fly
The FlySouthern Co (SO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$107.89B
Dividend Yield3.4%
Average Volume (3M)6.16M
Price to Earnings (P/E)24.4
Beta (1Y)-0.08
Revenue Growth8.33%
EPS Growth-6.26%
CountryUS
Employees28,314
SectorUtilities
Sector Strength65
IndustryRegulated Electric
Share Statistics
EPS (TTM)3.94
Shares Outstanding1,127,301,100
10 Day Avg. Volume7,390,027
30 Day Avg. Volume6,162,664
Financial Highlights & Ratios
PEG Ratio-11.12
Price to Book (P/B)2.67
Price to Sales (P/S)3.25
P/FCF Ratio-32.77
Enterprise Value/Market Cap1.66
Enterprise Value/Revenue5.94
Enterprise Value/Gross Profit13.79
Enterprise Value/Ebitda12.42
Forecast
1Y Price Target
$101.58Price Target Upside7.48% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering15
EPS Forecast (FY)4.58
Revenue Forecast (FY)$30.84B
Southern Co Business Overview & Revenue Model
Company Description
The Southern Company operates as an energy utility, primarily involved in the production, transmission, and distribution of electricity. Its operations are segmented into Gas Distribution Operations, Gas Pipeline Investments, Wholesale Gas Service...
How the Company Makes Money
Southern Company makes money primarily through regulated utility revenues and, to a lesser extent, through sales from non-utility/wholesale generation and other energy-related services. (1) Regulated electric utilities: The largest share of earnin...
Southern Co Earnings Call Summary
Earnings Call Date:Apr 30, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 30, 2026
Earnings Call Sentiment Positive
The call conveyed a broadly positive outlook: the company beat EPS expectations, reported strong demand growth (notably a 42% increase in data center usage and 2.3% weather-normal sales growth), advanced significant large-load contracts and a sizeable project pipeline, secured a major $26.5 billion DOE loan package projected to save customers $7 billion, and increased the dividend. Offsetting items include higher financing costs, milder weather, a remaining equity need of about $1.8 billion, supply-chain/labor tightness, and the potential for materially higher future capital spending depending on RFP outcomes. On balance, the operational and financial momentum and large-scale financing wins substantially outweigh the execution and financing risks discussed.Positive Updates
Beating Estimates and EPS Growth
Adjusted EPS for Q1 2026 was $1.32, up $0.09 year-over-year and $0.12 above the company estimate.
Negative Updates
Higher Financing Costs
Higher financing costs were cited as a partial offset to quarter performance, reducing the net benefit from stronger demand.
Read all updates
Q1-2026 Updates
Positive
Negative
Beating Estimates and EPS Growth
Adjusted EPS for Q1 2026 was $1.32, up $0.09 year-over-year and $0.12 above the company estimate.
Read all positive updates
Company Guidance
The company’s near-term guidance and outlook included Q1 adjusted EPS of $1.32 (up $0.09 YoY and $0.12 above estimate) and a Q2 adjusted EPS estimate of $1.00; operational metrics included weather-normal Q1 retail sales +2.3% YoY, 46,000 new residential customers, commercial sales +4.5% (weather-adjusted), data center usage +42% YoY, and industrial sales +1.5%; growth pipeline and resource metrics cited >75 GW prospective pipeline, 23 GW of contracted or late-stage load, >11 GW fully contracted after 1.9 GW of recent signings, 12 GW in late-stage discussions (up 2 GW QoQ) with ~6 GW expected to finalize near term, a 10 GW portfolio of approved new generation resources in development, Georgia Power adding nearly 200 MW of battery capacity from two BESS, and a Georgia all-source RFP for 2–6 GW targeting 2032–2033; Southern Power plans 400 MW of turbine uprates (commercial ops 2029–2031) adding ~ $700M to the capital plan and is evaluating an additional 300 MW; financing and capital metrics included $26.5B of DOE loan agreements projected to yield ~$7B of cumulative customer savings over ~30 years, $500M of incremental equity sourced via ATM (forwards settling by 2028), a projected $1.8B remaining equity/equivalents need through 2030, and a goal of 17% FFO-to-debt by 2029; the Board raised the annual dividend $0.08 to $3.04 (25th consecutive annual increase; 79 years of non-decreasing dividends).Southern Co Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
63
Positive
Cash Flow
52
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 30.17B | 29.55B | 26.72B | 25.25B | 29.28B | 23.11B |
| Gross Profit | 13.01B | 8.81B | 13.34B | 11.71B | 10.63B | 10.25B |
| EBITDA | 14.44B | 14.33B | 13.24B | 11.78B | 10.31B | 8.39B |
| Net Income | 4.36B | 4.34B | 4.40B | 3.98B | 3.54B | 2.41B |
Balance Sheet | ||||||
| Total Assets | 157.03B | 155.72B | 145.18B | 139.33B | 134.89B | 127.53B |
| Cash, Cash Equivalents and Short-Term Investments | 981.00M | 1.64B | 1.07B | 748.00M | 1.92B | 1.80B |
| Total Debt | 76.00B | 65.82B | 66.28B | 63.49B | 59.13B | 55.47B |
| Total Liabilities | 117.12B | 116.85B | 108.51B | 104.11B | 100.36B | 94.97B |
| Stockholders Equity | 37.12B | 36.02B | 33.21B | 31.44B | 30.41B | 28.16B |
Cash Flow | ||||||
| Free Cash Flow | -3.78B | -2.94B | 833.00M | -1.54B | -1.62B | -1.07B |
| Operating Cash Flow | 9.78B | 9.80B | 9.79B | 7.55B | 6.30B | 6.17B |
| Investing Cash Flow | -14.55B | -13.96B | -9.40B | -9.67B | -8.43B | -7.35B |
| Financing Cash Flow | 3.42B | 4.70B | -208.00M | 999.00M | 2.34B | 1.95B |
Southern Co Technical Analysis
Positive
94.51
Price Trends
93.32
Positive
93.93
Positive
91.46
Positive
Market Momentum
0.87
Negative
57.08
Neutral
83.12
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SO, the sentiment is Positive. The current price of 94.51 is above the 20-day moving average (MA) of 93.71, above the 50-day MA of 93.32, and above the 200-day MA of 91.46, indicating a bullish trend. The MACD of 0.87 indicates Negative momentum. The RSI at 57.08 is Neutral, neither overbought nor oversold. The STOCH value of 83.12 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SO.
Southern Co Risk Analysis
Southern Co disclosed 30 risk factors in its most recent earnings report. Southern Co reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Southern Co Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $183.05B | 22.33 | 15.24% | 2.84% | 11.51% | 47.33% | |
70 Outperform | $74.44B | 20.21 | 11.86% | 3.25% | 9.38% | 31.12% | |
66 Neutral | $107.89B | 24.40 | 12.28% | 3.40% | 8.33% | -6.26% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
65 Neutral | $98.68B | 19.53 | 9.85% | 3.61% | 7.21% | 8.97% | |
61 Neutral | $60.06B | 20.27 | 10.51% | 4.59% | 19.15% | 27.09% | |
59 Neutral | $47.70B | 17.11 | 9.76% | 3.68% | 4.58% | 1.43% |
* Utilities Sector Average
SO
Southern Co
95.71
7.44
8.43%
AEP
American Electric Power
136.81
36.72
36.69%
D
Dominion Energy
68.29
13.30
24.18%
DUK
Duke Energy
126.58
13.47
11.91%
EXC
Exelon
46.62
5.20
12.54%
NEE
NextEra Energy
87.77
16.80
23.68%
Southern Co Corporate Events
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Southern Co Issues $1.3 Billion Subordinated Notes
Positive
Mar 19, 2026
On March 16, 2026, The Southern Company entered into an underwriting agreement with a syndicate of major investment banks to issue and sell $1.3 billion of its Series 2026A 6.00% Fixed-to-Fixed Reset Rate Junior Subordinated Notes due April 1, 205...
Business Operations and StrategyPrivate Placements and Financing
Southern Subsidiaries Secure DOE-Backed Credit Facilities
Positive
Feb 25, 2026
On February 20, 2026, Alabama Power and Georgia Power, both Southern Co. subsidiaries, executed separate loan guarantee agreements with the U.S. Department of Energy under the Title XVII loan guarantee program. On the same date, each utility also ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.