Back to top

Image: Bigstock

Southern Co. (SO) Gains As Market Dips: What You Should Know

Read MoreHide Full Article

In the latest trading session, Southern Co. (SO - Free Report) closed at $61.88, marking a +0.24% move from the previous day. The stock outpaced the S&P 500's daily loss of 0.24%. At the same time, the Dow lost 0.3%, and the tech-heavy Nasdaq lost 0.58%.

Heading into today, shares of the power company had gained 6.78% over the past month, outpacing the Utilities sector's gain of 5.06% and the S&P 500's gain of 4.96% in that time.

Investors will be hoping for strength from SO as it approaches its next earnings release. The company is expected to report EPS of $1.14, unchanged from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $5.91 billion, down 4.12% from the prior-year quarter.

SO's full-year Zacks Consensus Estimates are calling for earnings of $3.04 per share and revenue of $22.12 billion. These results would represent year-over-year changes of -0.98% and -5.86%, respectively.

It is also important to note the recent changes to analyst estimates for SO. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.51% higher within the past month. SO is currently a Zacks Rank #3 (Hold).

In terms of valuation, SO is currently trading at a Forward P/E ratio of 20.28. This valuation marks a discount compared to its industry's average Forward P/E of 21.64.

It is also worth noting that SO currently has a PEG ratio of 4.51. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Utility - Electric Power was holding an average PEG ratio of 3.91 at yesterday's closing price.

The Utility - Electric Power industry is part of the Utilities sector. This industry currently has a Zacks Industry Rank of 73, which puts it in the top 29% 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.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Southern Company (The) (SO) - free report >>

Published in