Southern Company logged a 2.3% change during today's morning session, and is now trading at a price of $71.22 per share. The S&P 500 index moved -0.0% and the Nasdaq posted a -1.0% change.
Southern Company shares moved -9.0% over the last 52 weeks, with a high of $80.57 and a low of $60.71. During this time, the stock basically tracked the performance of the S&P 500. As of January 2022, the company's 50-day average price is $67.0.
The Southern Company, through its subsidiaries, engages in the generation, transmission, and distribution of electricity. The large-cap Utilities company has 27,423 full time employees and is based in Atlanta, GA. Southern Company has returned a 3.9% dividend yield over the last 12 months.
Snapshot of the Company's Decent Operating Margins:
| 2019-12-31 | 2020-12-31 | 2021-12-31 | 2022-12-31 | |
|---|---|---|---|---|
| Revenue (MM) | $21,419 | $20,375 | $23,113 | $29,279 |
| Revenue Growth | n/a | -4.87% | 13.44% | 26.68% |
| Gross Margins | 45.0% | 48.6% | 43.5% | 37.0% |
| Gross Margins Growth | n/a | 8.0% | -10.49% | -14.94% |
| Operating Margins | 24.9% | 23.7% | 15.2% | 19.0% |
| Operating Margins Growth | n/a | -4.82% | -35.86% | 25.0% |
| Net Margins | 22.2% | 15.38% | 10.42% | 12.07% |
| Net Margins Growth | n/a | -30.72% | -32.25% | 15.83% |
| Earnings Per Share | $4.5 | $2.95 | $2.26 | $3.26 |
| EPS Growth | n/a | -34.44% | -23.39% | 44.25% |
| Diluted Shares (MM) | 1,053 | 1,058 | 1,061 | 1,089 |
| Free Cash Flow (MM) | -$1,774 | -$745 | -$1,071 | -$1,621 |
| FCF Growth | n/a | 58.0% | -43.76% | -51.35% |
| Capital Expenditures (MM) | -$7,555 | -$7,441 | -$7,240 | -$7,923 |
| Net Debt / EBITDA | 4.94 | 5.22 | 6.47 | 5.41 |
Southern Company Is Too Expensive at Current Levels:
Compared to the Utilities sector's average of 22.89, Southern Company has a trailing twelve month P/E ratio of 21.8 and, according to its EPS guidance of 4.03, an expected P/E ratio of 17.7. Southern Company's PEG ratio is 7.94 based on its -2.2% compound average growth rate of historical and projected earnings per share. This suggests that the company's shares are overvalued.
Southern Company's P/B ratio is 2.5 compared to its sector average of 1.03. The company is likely overvalued in terms of its net asset value. The company's shares are currently trading 57.8% above their fair value as expressed by Benjamin Graham's formula:
√(22.5 * 4-year average EPS * book value per share) = √(22.5 * 3.24 * 27.928) = $45.12
Southern Company Is the Subject of Mixed Market Indicators:
13 analysts are following Southern Company and have set target prices ranging from $57.0 to $79.0 per share. On average, they have given the company a rating of hold. At the current price of $71.22, SO is trading 0.52% away from its average analyst target price of $70.85 per share, implying an analyst consensus of little upside potential for the stock.
The company has a very low short interest since 1.1% of the company's shares are tied to short positions. Institutions own 64.2% of Southern Company's shares, while the insider ownership rate stands at 0.2%. The biggest shareholder is the Vanguard Group, Inc. with a 9% stake in the company worth approximately $6,972,961,174.
