The Southern Company (SO), headquartered in Atlanta, Georgia, is an energy provider specializing in generating, transmitting, and distributing electricity. With a market cap of $101.4 billion, the company serves millions of customers across the southeastern U.S. through a diverse energy portfolio, including traditional and renewable sources. The Southern Company is set to announce its Q3 earnings before the market opens on Thursday, Oct. 31.
Ahead of the event, analysts expect SO to report a profit of $1.32 per share, down 7% from $1.42 in the year-ago quarter. The company has consistently beaten Wall Street's earnings estimates in the last four quarters.
Its adjusted earnings of $1.09 per share for the last quarter surpassed the consensus estimate by 19.8%. Southern Company's quarterly gains were driven by strong utility earnings, operational efficiencies, and increased energy demand due to favorable weather.
For fiscal 2024, analysts expect SO to report EPS of $4.02, up 10.1% from $3.65 in fiscal 2023.
SO stock is up 32.2% on a YTD basis, outperforming the broader S&P 500 Index's ($SPX) 22.7% gains and the Vanguard Utilities Index Fund ETF Shares’ (VPU) 28.1% gain over the same time frame.
Shares of Southern Company have outperformed the broader market in 2024, powered by strategic moves like the completion of two nuclear plants in Georgia, making it the largest clean energy generator in the U.S. Despite past delays, Vogtle Units 3 and 4 solidified the utility company’s position in carbon-free energy, crucial as demand for reliable power grows with AI and data centers.
Southern Company’s regulated utility operations provided stable cash flow, appealing to long-term investors. Its energy mix - spanning natural gas, coal, nuclear, and renewables - offers flexibility amid energy price shifts. Plus, an impressive history of consistent dividends, coupled with government support for energy infrastructure, reinforced the company's resilience, especially during economic uncertainty.
Moreover, when warmer weather boosted electricity sales and Q2 top and bottom lines outperformed, the stock jumped 4.9% on Aug. 1, further proving SO’s ability to thrive in any environment.
The consensus opinion on SO stock is moderately bullish, with an overall “Moderate Buy” rating. Of 21 analysts covering the stock, eight advise a “Strong Buy” rating, one indicates a “Moderate Buy,” eleven suggest a “Hold,” and one advises “Strong Sell.”
Although SO currently trades at a premium to the average analyst price target of $91.14, the Street-high target price of $104 suggests the stock could rally as much as 12.2%.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
