Southern Co. (SO) ended the recent trading session at $83.14, demonstrating a +0.36% swing from the preceding day's closing price. The stock exceeded the S&P 500, which registered a loss of 1.11% for the day. At the same time, the Dow lost 0.77%, and the tech-heavy Nasdaq lost 1.49%.
Heading into today, shares of the power company had lost 7.69% over the past month, lagging the Utilities sector's loss of 7.06% and the S&P 500's gain of 0.4% in that time.
The upcoming earnings release of Southern Co. will be of great interest to investors. The company's upcoming EPS is projected at $0.52, signifying a 18.75% drop compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $6.21 billion, showing a 2.66% escalation compared to the year-ago quarter.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $4.04 per share and a revenue of $26.46 billion, representing changes of +10.68% and +4.79%, respectively, from the prior year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Southern Co. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. 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 0.38% higher within the past month. Southern Co. currently has a Zacks Rank of #2 (Buy).
In terms of valuation, Southern Co. is currently trading at a Forward P/E ratio of 20.49. For comparison, its industry has an average Forward P/E of 16.51, which means Southern Co. is trading at a premium to the group.
One should further note that SO currently holds a PEG ratio of 3.01. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Utility - Electric Power stocks are, on average, holding a PEG ratio of 2.66 based on yesterday's closing prices.
The Utility - Electric Power industry is part of the Utilities sector. At present, this industry carries a Zacks Industry Rank of 77, placing it within the top 31% of over 250 industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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