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Southern Co. (SO) Ascends While Market Falls: Some Facts to Note

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The latest trading session saw Southern Co. (SO - Free Report) ending at $78.87, denoting a +1.19% adjustment from its last day's close. The stock's performance was ahead of the S&P 500's daily loss of 0.25%. Elsewhere, the Dow saw an upswing of 0.77%, while the tech-heavy Nasdaq depreciated by 0.79%.

Heading into today, shares of the power company had lost 0.95% over the past month, outpacing the Utilities sector's loss of 6.21% and lagging the S&P 500's gain of 3.59% in that time.

The upcoming earnings release of Southern Co. will be of great interest to investors. On that day, Southern Co. is projected to report earnings of $0.90 per share, which would represent year-over-year growth of 13.92%. At the same time, our most recent consensus estimate is projecting a revenue of $6.23 billion, reflecting an 8.34% rise from the equivalent quarter last year.

For the full year, the Zacks Consensus Estimates project earnings of $3.99 per share and a revenue of $27.35 billion, demonstrating changes of +9.32% and +8.31%, respectively, from the preceding year.

Investors might also notice recent changes to analyst estimates for Southern Co. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.13% upward. Southern Co. is holding a Zacks Rank of #3 (Hold) right now.

With respect to valuation, Southern Co. is currently being traded at a Forward P/E ratio of 19.52. Its industry sports an average Forward P/E of 14.8, so one might conclude that Southern Co. is trading at a premium comparatively.

It is also worth noting that SO currently has a PEG ratio of 2.81. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Utility - Electric Power was holding an average PEG ratio of 2.57 at yesterday's closing price.

The Utility - Electric Power industry is part of the Utilities sector. Currently, this industry holds a Zacks Industry Rank of 85, positioning it in the top 34% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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