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In the latest market close, Southern Co. (SO) reached $82.07, with a -0.3% movement compared to the previous day. This move lagged the S&P 500's daily loss of 0.22%. Meanwhile, the Dow lost 0.36%, and the Nasdaq, a tech-heavy index, lost 0.16%.
The power company's stock has dropped by 4.11% in the past month, exceeding the Utilities sector's loss of 7.45% and lagging the S&P 500's loss of 2.36%.
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 $0.52 per share. This would mark a year-over-year decline of 18.75%. Our most recent consensus estimate is calling for quarterly revenue of $6.21 billion, up 2.66% from the year-ago period.
Any recent changes to analyst estimates for Southern Co. should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional 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. The Zacks Consensus EPS estimate has moved 0.5% higher within the past month. Southern Co. is currently sporting a Zacks Rank of #3 (Hold).
Looking at its valuation, Southern Co. is holding a Forward P/E ratio of 19.05. This valuation marks a premium compared to its industry's average Forward P/E of 15.92.
We can additionally observe that SO currently boasts a PEG ratio of 2.8. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As of the close of trade yesterday, the Utility - Electric Power industry held an average PEG ratio of 2.51.
The Utility - Electric Power industry is part of the Utilities sector. This group has a Zacks Industry Rank of 84, putting it in the top 34% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.