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In the latest trading session, Southern Co. (SO) closed at $89.44, marking a +1.07% move from the previous day. This change outpaced the S&P 500’s 0.54% gain on the day. Elsewhere, the Dow saw an upswing of 0.72%, while the tech-heavy Nasdaq appreciated by 0.65%.
The power company’s stock has climbed by 1.7% in the past month, falling short of the Utilities sector’s gain of 4.65% and the S&P 500’s gain of 4.86%.
Market participants will be closely following the financial results of Southern Co. in its upcoming release. In that report, analysts expect Southern Co. to post earnings of $1.31 per share. This would mark a year-over-year decline of 7.75%. Alongside, our most recent consensus estimate is anticipating revenue of $7.2 billion, indicating a 3.11% upward movement from the same quarter last year.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $4.01 per share and revenue of $26.52 billion, indicating changes of +9.86% and +5%, respectively, compared to the previous year.
Investors might also notice recent changes to analyst estimates for Southern Co. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts’ positivity towards the company’s business operations and its ability to generate profits.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we’ve formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.07% higher. Southern Co. is currently a Zacks Rank #3 (Hold).
Looking at valuation, Southern Co. is presently trading at a Forward P/E ratio of 22.05. This indicates a premium in contrast to its industry’s Forward P/E of 17.03.
We can also see that SO currently has a PEG ratio of 3.17. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. The Utility – Electric Power industry had an average PEG ratio of 2.81 as trading concluded yesterday.
The Utility – Electric Power industry is part of the Utilities sector. With its current Zacks Industry Rank of 48, this industry ranks in the top 19% of all industries, numbering over 250.
The Zacks Industry Rank gauges the strength of our individual 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.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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