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Power supplier The Southern Company (SO - Free Report) reported third-quarter 2022 earnings per share (excluding certain one-time items) of $1.31, lagging the Zacks Consensus Estimate of $1.33. The underperformance reflects a spike in operations and maintenance cost.
However, SO’s bottom line was above the year-earlier quarter’s adjusted profit of $1.23 per share, backed by the positive effects of rates, usage and pricing changes, plus a demand boost from favorable weather.
The utility reported revenues of $8.4 billion. The top line beat the Zacks Consensus Estimate of $6.8 billion and was 34.3% higher than third-quarter 2021 sales.
The firm is guiding for earnings per share toward the upper end of its guidance of $3.50-$3.60 this year.
Southern Company The Price, Consensus and EPS Surprise
Per Southern Company’s latest earnings presentation, it expects to maintain the timelines for the completion of the Units 3 and 4 of the Vogtle nuclear project. The utility’s in-service dates for the facilities are first-quarter 2023 (unit 3) and fourth-quarter 2023 (unit 4). Moreover, Southern Company kept the share of its Georgia Power subsidiary in capital costs for the units intact.
Overall Sales Breakup
Southern Company’s wholesale power sales jumped 10.4%, which was complemented by a rise in retail electricity demand.
Overall, there was an upward movement in overall electricity sales and usage. In fact, total electricity sales during the third quarter were up 4.6% from the same period last year.
Southern Company’s total retail sales moved up 2.6%, with residential, industrial and commercial sales increasing 2.9%, 2.2% and 2.7%, respectively.
Expenses Summary
The power supplier’s operations and maintenance cost rose 7% year over year to $1.5 billion, while the utility’s total operating expense for the period — at $6.2 billion — was up 37% from the prior-year level.
Zacks Rank & Stock Picks
Southern Company carries a Zacks Rank #3 (Hold).
Meanwhile, investors interested in the utility space could look at better options like American Electric Power (AEP - Free Report) , American Water Works Company (AWK - Free Report) and NextEra Energy (NEE - Free Report) . All the firms carry a Zacks Rank #2 (Buy).
American Electric Power: American Electric Power is valued at around $44.9 billion. For 2022, AEP has a projected earnings growth rate of 6.1%.
American Electric Power delivered a four-quarter average earnings surprise of 2%. Headquartered in Columbus, OH, AEP shares have gained 2.9% in a year.
American Water Works Company: American Water Works is valued at around $25.3 billion. For 2022, AWK has a projected earnings growth rate of 4.5%.
American Water Works delivered a four-quarter average earnings surprise of 5.2%. Headquartered in Camden, NJ, AWK shares have lost 19% in a year.
NextEra Energy, Inc.: NextEra Energy is valued at around $148.5 billion. For 2022, NEE has a projected earnings growth rate of 13.3%.
NextEra Energy delivered a four-quarter average earnings surprise of 5.5%. Headquartered in Juno Beach, FL, NEE shares have lost 12.6% in a year.
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Southern (SO) Q3 Earnings Miss, Maintains Vogtle Timelines
Power supplier The Southern Company (SO - Free Report) reported third-quarter 2022 earnings per share (excluding certain one-time items) of $1.31, lagging the Zacks Consensus Estimate of $1.33. The underperformance reflects a spike in operations and maintenance cost.
However, SO’s bottom line was above the year-earlier quarter’s adjusted profit of $1.23 per share, backed by the positive effects of rates, usage and pricing changes, plus a demand boost from favorable weather.
The utility reported revenues of $8.4 billion. The top line beat the Zacks Consensus Estimate of $6.8 billion and was 34.3% higher than third-quarter 2021 sales.
The firm is guiding for earnings per share toward the upper end of its guidance of $3.50-$3.60 this year.
Southern Company The Price, Consensus and EPS Surprise
Southern Company The price-consensus-eps-surprise-chart | Southern Company The Quote
Vogtle Updates
Per Southern Company’s latest earnings presentation, it expects to maintain the timelines for the completion of the Units 3 and 4 of the Vogtle nuclear project. The utility’s in-service dates for the facilities are first-quarter 2023 (unit 3) and fourth-quarter 2023 (unit 4). Moreover, Southern Company kept the share of its Georgia Power subsidiary in capital costs for the units intact.
Overall Sales Breakup
Southern Company’s wholesale power sales jumped 10.4%, which was complemented by a rise in retail electricity demand.
Overall, there was an upward movement in overall electricity sales and usage. In fact, total electricity sales during the third quarter were up 4.6% from the same period last year.
Southern Company’s total retail sales moved up 2.6%, with residential, industrial and commercial sales increasing 2.9%, 2.2% and 2.7%, respectively.
Expenses Summary
The power supplier’s operations and maintenance cost rose 7% year over year to $1.5 billion, while the utility’s total operating expense for the period — at $6.2 billion — was up 37% from the prior-year level.
Zacks Rank & Stock Picks
Southern Company carries a Zacks Rank #3 (Hold).
Meanwhile, investors interested in the utility space could look at better options like American Electric Power (AEP - Free Report) , American Water Works Company (AWK - Free Report) and NextEra Energy (NEE - Free Report) . All the firms carry a Zacks Rank #2 (Buy).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
American Electric Power: American Electric Power is valued at around $44.9 billion. For 2022, AEP has a projected earnings growth rate of 6.1%.
American Electric Power delivered a four-quarter average earnings surprise of 2%. Headquartered in Columbus, OH, AEP shares have gained 2.9% in a year.
American Water Works Company: American Water Works is valued at around $25.3 billion. For 2022, AWK has a projected earnings growth rate of 4.5%.
American Water Works delivered a four-quarter average earnings surprise of 5.2%. Headquartered in Camden, NJ, AWK shares have lost 19% in a year.
NextEra Energy, Inc.: NextEra Energy is valued at around $148.5 billion. For 2022, NEE has a projected earnings growth rate of 13.3%.
NextEra Energy delivered a four-quarter average earnings surprise of 5.5%. Headquartered in Juno Beach, FL, NEE shares have lost 12.6% in a year.