The Southern Company
$91.62
+1.2%The Southern Company, through its subsidiaries, engages in the generation, transmission, and distribution of electricity. It operates through Gas Distribution Operations, Gas Pipeline Investments, Wholesale Gas Services, and Gas Marketing Services segments. The company also develops, constructs, acquires, owns, and manages power generation assets, including renewable energy projects and sells electricity in the wholesale market; and distributes natural gas in Illinois, Georgia, Virginia, and Tennessee, as well as provides gas marketing services, wholesale gas services, and gas pipeline investments operations. In addition, it owns and/or operates 30 hydroelectric generating stations, 24 fossil fuel generating stations, three nuclear generating stations, 13 combined cycle/cogeneration stations, 45 solar facilities, 15 wind facilities, one fuel cell facility, and four battery storage facility; and constructs, operates, and maintains 76,289 miles of natural gas pipelines and 14 storage facilities with total capacity of 157 Bcf to provide natural gas to residential, commercial, and industrial customers. The company serves approximately 8.7 million electric and gas utility customers. Further, the company offers digital wireless communications and fiber optics services. The Southern Company was incorporated in 1945 and is headquartered in Atlanta, Georgia.
At a Glance
Live SnapshotIntrinsic Alpha Methodology
Thesis Lenses
Signal
High confidenceValuation multiple is mid-range (P/E 23.3).
Valuation inputs: P/E 23.3, earnings yield +4.3%, momentum +1.2%.
If multiples stay elevated while momentum fades, downside repricing risk rises.
Driver
High confidenceReturn profile is acceptable (ROE +12.0%, ROIC +4.4%).
Profitability stack: net margin +14.7%, ROE +12.0%, ROIC +4.4%.
Quality deterioration often appears in margins before it shows up in headline EPS.
Risk
High confidenceRisk profile is balanced but has notable pressure points to monitor.
Risk factors: liabilities/assets +75.0%, momentum +1.2%, net margin +14.7%.
Higher leverage with weak momentum and thin margins can amplify drawdown severity.
The Southern Company Market vs Earnings Trajectory
Performance Analysis
EPS Growth
Positive earnings growth shows the company is improving its profitability over time.
Price-EPS Relationship
Stock price is moving in line with earnings growth—a healthy sign of fundamental-driven valuation.
Stock Price Change
Over the 1Y period, stock price has increased by 2.5%.
P/E Ratio (TTM)
Moderate P/E ratio suggests fair market valuation relative to earnings.
The Southern Company Fair Value Envelope
The Southern Company Profit Bridge
Profitability Analysis
Gross Margin
Moderate margins typical of competitive industries. Monitor for pricing pressure or rising costs.
Operating Margin
Healthy operating margins demonstrate effective cost control and strong business fundamentals.
Net Profit Margin
Strong net margins indicate efficient operations and favorable tax/interest management.
Effective Tax Rate
Moderate tax rate typical for most corporations. Represents standard tax burden on profits.
Profitability Insight
Efficient profit conversion: Minimal margin compression from gross to net indicates lean operations and favorable tax/interest environment.
The Southern Company Cash Conversion Engine
Cash Flow Quality Analysis
FCF Conversion Rate
Negative free cash flow despite positive earnings raises concerns about cash generation ability or heavy capital requirements.
CapEx Intensity
Very high capital intensity consumes most operating cash flow. Limited flexibility for dividends or debt reduction.
FCF Growth Trend
Significant FCF decline raises concerns. Urgent review needed of operational performance and capital allocation.
Working Capital Impact
Working capital inflow boosted cash flow. Efficient management of receivables, inventory, and payables contributing positively.
Cash Flow Quality Insight
Cash flow concerns: Despite profitability, the company is burning cash. Review working capital management, CapEx levels, and sustainability of current operations.
The Southern Company Funding & Solvency Profile
Financial Health Analysis
Current Ratio
Warning: Liquidity concerns. Current assets may not be sufficient to cover short-term obligations.
Debt-to-Equity Ratio
High financial leverage. Heavy reliance on debt may indicate increased financial risk and potential solvency concerns.
Working Capital
Negative working capital indicates short-term liabilities exceed short-term assets—potential liquidity stress.
Asset Composition
Capital-intensive business with significant long-term investments in property, equipment, or intangibles.
Financial Health Insight
Financial stress indicators: Both liquidity and leverage metrics raise concerns. The company may face challenges meeting obligations and should focus on strengthening its balance sheet.
The Southern Company Street Expectations Map
Wall Street analysts project that SO stock may experience modest gains over the coming 12 months. The consensus 1-year price target stands at 99.54, with estimates ranging from a low of 76.00 to a high of 112.00.
The consensus 1-year price target stands at 99.54, with estimates ranging from a low of 76.00 to a high of 112.00.
Analyst Consensus Analysis
Upside Potential
Moderate upside. Analysts expect positive returns but with limited margin of safety. Consider entry timing.
Analyst Agreement
Good consensus alignment. Moderate target spread reflects general agreement on value drivers with some variance in assumptions.
Risk-Reward Profile
Balanced risk-reward. Upside and downside potential relatively symmetric. Suitable for moderate risk tolerance with conviction in thesis.
Analyst Conviction
Positive outlook with reasonable agreement. Analysts generally optimistic about prospects with manageable uncertainty.
Market Sentiment Insight
Monitor and evaluate: Current analyst consensus suggests limited conviction or near-term catalysts. Stay informed on company developments and reassess positioning as new information emerges.
The Southern Company Insider Positioning
During the last 12 months, insiders have sold $6.84M worth of SO shares, with no buying activity reported.
3 Months
0
0.00
44.4K
4.29M
-4.3M
-$4.29M
3-6 Months
0
0.00
5.1K
487.45K
-487K
-$487K
6-9 Months
0
0.00
6.2K
582.31K
-582K
-$582K
9-12 Months
0
0.00
15.5K
1.48M
-1.5M
-$1.48M
Top Buyers
No buying activity
Top Sellers
Greene Kimberly S,
Officer: Chairman, President & Ceo, Gpc
$3.67M
Connally Stan W
Officer: Evp & Coo
$1.21M
Cummiskey Christopher
Officer: Evp
$644K
Anderson Bryan D
Officer: Evp
$582K
Kim Matthew M.
Officer: Comptroller
$506K
Insider Activity Analysis
Net Insider Sentiment
Strong bearish signal with $6.84M net selling. Heavy insider selling may indicate concerns about valuation or near-term prospects.
Buy/Sell Ratio
Very poor ratio. Heavy selling with minimal buying suggests insiders may be concerned about valuation or outlook.
Recent Trend (3 Months)
Heavy recent selling activity. Recent insider sales notably exceed purchases—may warrant investigation into company developments.
Insider Participation
5 insider sellers vs. 0 buyers. Widespread selling across multiple insiders may signal concerns.
Insider Activity Insight
Multiple red flags: Heavy selling, numerous sellers, and continued recent selling create a concerning pattern. Investigate fundamental drivers and consider whether company guidance or industry conditions have deteriorated.
so Dividend History
Learning Layer
Related Guides
Build conviction on SO by pairing this stock hub with focused valuation guides.
Research Paths
Snapshot
Start with context, operating signals, and key market metrics.
Value Model
Stress test fair value across bear, base, and bull assumptions.
Statements
Validate revenue quality, margins, and balance sheet durability.
Earnings Call
Read management commentary and compare it with reported outcomes.
Dividends
Check payout sustainability and long-term distribution behavior.
Analyst Expectations
Review consensus spread and where estimate risk is concentrated.