SOUTHERN CO/THE (SO) Stock Fundamental Analysis
USA - NYSE:SO - US8425871071 - Common Stock
89.05 USD
-1.64 (-1.81%)
88.95 USD
-0.1 (-0.11%)
Overall SO gets a fundamental rating of 4 out of 10. We evaluated SO against 46 industry peers in the Electric Utilities industry. SO scores excellent on profitability, but there are concerns on its financial health. While showing a medium growth rate, SO is valued expensive at the moment. Finally SO also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year SO was profitable.
SO had a positive operating cash flow in the past year.
Each year in the past 5 years SO has been profitable.
In the past 5 years SO always reported a positive cash flow from operatings.
1.2 Ratios
With a Return On Assets value of 2.91%, SO perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
SO has a better Return On Equity (12.74%) than 69.57% of its industry peers.
SO has a better Return On Invested Capital (4.62%) than 65.22% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for SO is in line with the industry average of 5.00%.
The 3 year average ROIC (4.14%) for SO is below the current ROIC(4.62%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.91% | ||
| ROE | 12.74% | ||
| ROIC | 4.62% |
ROA(3y)2.83%
ROA(5y)2.58%
ROE(3y)12.5%
ROE(5y)11.4%
ROIC(3y)4.14%
ROIC(5y)4.02%
1.3 Margins
SO has a Profit Margin of 15.42%. This is in the better half of the industry: SO outperforms 69.57% of its industry peers.
SO's Profit Margin has declined in the last couple of years.
SO has a better Operating Margin (25.68%) than 73.91% of its industry peers.
In the last couple of years the Operating Margin of SO has remained more or less at the same level.
SO has a better Gross Margin (89.28%) than 82.61% of its industry peers.
In the last couple of years the Gross Margin of SO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.68% | ||
| PM (TTM) | 15.42% | ||
| GM | 89.28% |
OM growth 3Y5.39%
OM growth 5Y1.06%
PM growth 3Y16.73%
PM growth 5Y-5.73%
GM growth 3Y0.95%
GM growth 5Y0.39%
2. Health
2.1 Basic Checks
SO has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, SO has about the same amount of shares outstanding.
Compared to 5 years ago, SO has about the same amount of shares outstanding.
The debt/assets ratio for SO is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.95, we must say that SO is in the distress zone and has some risk of bankruptcy.
SO has a Altman-Z score (0.95) which is in line with its industry peers.
SO has a Debt/Equity ratio of 1.85. This is a high value indicating a heavy dependency on external financing.
SO's Debt to Equity ratio of 1.85 is on the low side compared to the rest of the industry. SO is outperformed by 86.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.95 |
ROIC/WACC0.69
WACC6.66%
2.3 Liquidity
SO has a Current Ratio of 0.75. This is a bad value and indicates that SO is not financially healthy enough and could expect problems in meeting its short term obligations.
SO has a Current ratio of 0.75. This is in the lower half of the industry: SO underperforms 63.04% of its industry peers.
SO has a Quick Ratio of 0.75. This is a bad value and indicates that SO is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.56, SO is doing worse than 67.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.75 | ||
| Quick Ratio | 0.56 |
3. Growth
3.1 Past
SO shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.19%.
SO shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.48% yearly.
Looking at the last year, SO shows a quite strong growth in Revenue. The Revenue has grown by 9.40% in the last year.
The Revenue has been growing slightly by 4.53% on average over the past years.
EPS 1Y (TTM)1.19%
EPS 3Y5.99%
EPS 5Y5.48%
EPS Q2Q%11.89%
Revenue 1Y (TTM)9.4%
Revenue growth 3Y4.96%
Revenue growth 5Y4.53%
Sales Q2Q%7.55%
3.2 Future
Based on estimates for the next years, SO will show a small growth in Earnings Per Share. The EPS will grow by 7.15% on average per year.
The Revenue is expected to grow by 6.35% on average over the next years.
EPS Next Y8.37%
EPS Next 2Y7.72%
EPS Next 3Y7.6%
EPS Next 5Y7.15%
Revenue Next Year7.63%
Revenue Next 2Y6.29%
Revenue Next 3Y5.88%
Revenue Next 5Y6.35%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
SO is valuated rather expensively with a Price/Earnings ratio of 20.95.
Based on the Price/Earnings ratio, SO is valued a bit more expensive than the industry average as 67.39% of the companies are valued more cheaply.
When comparing the Price/Earnings ratio of SO to the average of the S&P500 Index (25.47), we can say SO is valued inline with the index average.
A Price/Forward Earnings ratio of 18.90 indicates a rather expensive valuation of SO.
The rest of the industry has a similar Price/Forward Earnings ratio as SO.
When comparing the Price/Forward Earnings ratio of SO to the average of the S&P500 Index (35.42), we can say SO is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.95 | ||
| Fwd PE | 18.9 |
4.2 Price Multiples
63.04% of the companies in the same industry are cheaper than SO, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.63 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates SO does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of SO may justify a higher PE ratio.
PEG (NY)2.5
PEG (5Y)3.83
EPS Next 2Y7.72%
EPS Next 3Y7.6%
5. Dividend
5.1 Amount
SO has a Yearly Dividend Yield of 5.76%, which is a nice return.
Compared to an average industry Dividend Yield of 3.77, SO pays a better dividend. On top of this SO pays more dividend than 91.30% of the companies listed in the same industry.
SO's Dividend Yield is rather good when compared to the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.76% |
5.2 History
The dividend of SO has a limited annual growth rate of 1.87%.
SO has paid a dividend for at least 10 years, which is a reliable track record.
SO has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)1.87%
Div Incr Years23
Div Non Decr Years34
5.3 Sustainability
67.01% of the earnings are spent on dividend by SO. This is not a sustainable payout ratio.
The dividend of SO is growing, but earnings are growing more, so the dividend growth is sustainable.
DP67.01%
EPS Next 2Y7.72%
EPS Next 3Y7.6%
89.05
-1.64 (-1.81%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners71.62%
Inst Owner Change4.46%
Ins Owners0.09%
Ins Owner Change-1.47%
Market Cap97.96B
Revenue(TTM)28.91B
Net Income(TTM)4.46B
Analysts72.12
Price Target102.04 (14.59%)
Short Float %3.48%
Short Ratio6.74
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.76% |
Yearly Dividend2.69
Dividend Growth(5Y)1.87%
DP67.01%
Div Incr Years23
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.4%
Min EPS beat(2)-0.3%
Max EPS beat(2)3.1%
EPS beat(4)1
Avg EPS beat(4)-0.4%
Min EPS beat(4)-4.33%
Max EPS beat(4)3.1%
EPS beat(8)5
Avg EPS beat(8)3.95%
EPS beat(12)9
Avg EPS beat(12)4.23%
EPS beat(16)11
Avg EPS beat(16)4.62%
Revenue beat(2)1
Avg Revenue beat(2)3.8%
Min Revenue beat(2)-0.17%
Max Revenue beat(2)7.77%
Revenue beat(4)3
Avg Revenue beat(4)4.4%
Min Revenue beat(4)-0.17%
Max Revenue beat(4)7.77%
Revenue beat(8)4
Avg Revenue beat(8)-1.23%
Revenue beat(12)6
Avg Revenue beat(12)-1.21%
Revenue beat(16)10
Avg Revenue beat(16)3.55%
PT rev (1m)3.65%
PT rev (3m)4.29%
EPS NQ rev (1m)-6.04%
EPS NQ rev (3m)-7.53%
EPS NY rev (1m)0.12%
EPS NY rev (3m)-0.08%
Revenue NQ rev (1m)0.46%
Revenue NQ rev (3m)0.24%
Revenue NY rev (1m)0.75%
Revenue NY rev (3m)2.28%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.95 | ||
| Fwd PE | 18.9 | ||
| P/S | 3.39 | ||
| P/FCF | N/A | ||
| P/OCF | 10.45 | ||
| P/B | 2.8 | ||
| P/tB | 3.32 | ||
| EV/EBITDA | 12.63 |
EPS(TTM)4.25
EY4.77%
EPS(NY)4.71
Fwd EY5.29%
FCF(TTM)-1.66
FCFYN/A
OCF(TTM)8.53
OCFY9.57%
SpS26.28
BVpS31.82
TBVpS26.85
PEG (NY)2.5
PEG (5Y)3.83
Graham Number55.16
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.91% | ||
| ROE | 12.74% | ||
| ROCE | 5.44% | ||
| ROIC | 4.62% | ||
| ROICexc | 4.74% | ||
| ROICexgc | 4.94% | ||
| OM | 25.68% | ||
| PM (TTM) | 15.42% | ||
| GM | 89.28% | ||
| FCFM | N/A |
ROA(3y)2.83%
ROA(5y)2.58%
ROE(3y)12.5%
ROE(5y)11.4%
ROIC(3y)4.14%
ROIC(5y)4.02%
ROICexc(3y)4.18%
ROICexc(5y)4.06%
ROICexgc(3y)4.38%
ROICexgc(5y)4.26%
ROCE(3y)4.95%
ROCE(5y)4.79%
ROICexgc growth 3Y6.47%
ROICexgc growth 5Y1.27%
ROICexc growth 3Y6.72%
ROICexc growth 5Y1.53%
OM growth 3Y5.39%
OM growth 5Y1.06%
PM growth 3Y16.73%
PM growth 5Y-5.73%
GM growth 3Y0.95%
GM growth 5Y0.39%
F-Score5
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 4.91 | ||
| Cap/Depr | 193.96% | ||
| Cap/Sales | 38.74% | ||
| Interest Coverage | 2.75 | ||
| Cash Conversion | 71.04% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.75 | ||
| Quick Ratio | 0.56 | ||
| Altman-Z | 0.95 |
F-Score5
WACC6.66%
ROIC/WACC0.69
Cap/Depr(3y)182.47%
Cap/Depr(5y)184.04%
Cap/Sales(3y)32.2%
Cap/Sales(5y)32.89%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)1.19%
EPS 3Y5.99%
EPS 5Y5.48%
EPS Q2Q%11.89%
EPS Next Y8.37%
EPS Next 2Y7.72%
EPS Next 3Y7.6%
EPS Next 5Y7.15%
Revenue 1Y (TTM)9.4%
Revenue growth 3Y4.96%
Revenue growth 5Y4.53%
Sales Q2Q%7.55%
Revenue Next Year7.63%
Revenue Next 2Y6.29%
Revenue Next 3Y5.88%
Revenue Next 5Y6.35%
EBIT growth 1Y6.57%
EBIT growth 3Y10.62%
EBIT growth 5Y5.63%
EBIT Next Year84.89%
EBIT Next 3Y28.4%
EBIT Next 5Y19.8%
FCF growth 1Y6.85%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y33.49%
OCF growth 3Y16.63%
OCF growth 5Y11.11%
SOUTHERN CO/THE / SO FAQ
What is the fundamental rating for SO stock?
ChartMill assigns a fundamental rating of 4 / 10 to SO.
Can you provide the valuation status for SOUTHERN CO/THE?
ChartMill assigns a valuation rating of 1 / 10 to SOUTHERN CO/THE (SO). This can be considered as Overvalued.
How profitable is SOUTHERN CO/THE (SO) stock?
SOUTHERN CO/THE (SO) has a profitability rating of 7 / 10.
What is the valuation of SOUTHERN CO/THE based on its PE and PB ratios?
The Price/Earnings (PE) ratio for SOUTHERN CO/THE (SO) is 20.95 and the Price/Book (PB) ratio is 2.8.
What is the financial health of SOUTHERN CO/THE (SO) stock?
The financial health rating of SOUTHERN CO/THE (SO) is 1 / 10.