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Southern Co. (SO) Registers a Bigger Fall Than the Market: Important Facts to Note

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In the latest trading session, Southern Co. (SO - Free Report) closed at $77.94, marking a -0.9% move from the previous day. This change lagged the S&P 500's 0.11% loss on the day. Elsewhere, the Dow lost 0.22%, while the tech-heavy Nasdaq lost 0.23%.

Heading into today, shares of the power company had gained 0.51% over the past month, lagging the Utilities sector's gain of 0.56% and the S&P 500's gain of 3.51% in that time.

Investors will be eagerly watching for the performance of Southern Co. in its upcoming earnings disclosure. The company's upcoming EPS is projected at $0.90, signifying a 13.92% increase compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $6.23 billion, indicating an 8.34% growth compared to the corresponding quarter of the prior year.

SO's full-year Zacks Consensus Estimates are calling for earnings of $4 per share and revenue of $27.16 billion. These results would represent year-over-year changes of +9.59% and +7.55%, respectively.

Any recent changes to analyst estimates for Southern Co. should also be noted by investors. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

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. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.18% increase. At present, Southern Co. boasts a Zacks Rank of #3 (Hold).

In the context of valuation, Southern Co. is at present trading with a Forward P/E ratio of 19.67. This indicates a premium in contrast to its industry's Forward P/E of 15.2.

We can additionally observe that SO currently boasts a PEG ratio of 2.83. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Utility - Electric Power was holding an average PEG ratio of 2.66 at yesterday's closing price.

The Utility - Electric Power industry is part of the Utilities sector. With its current Zacks Industry Rank of 76, this industry ranks in the top 31% of all industries, numbering over 250.

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.

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