The Southern Co.

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SO : NYSE : Utilities
$43.9 up 0.05 | 0.11%
Today's Range: 43.7936 - 44.46
Avg. Daily Volume: 7339800.0
03/21/18 - 4:00 PM ET

Financial Analysis

SOUTHERN CO's gross profit margin for the fourth quarter of its fiscal year 2017 has increased when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. SOUTHERN CO has very weak liquidity. Currently, the Quick Ratio is 0.39 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 3.90% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q4 FY17 Q4 FY16
Net Sales ($mil)5628.05181.0
EBITDA ($mil)1791.01496.5
EBIT ($mil)1017.0799.5
Net Income ($mil)501.0208.0

Balance Sheet Q4 FY17 Q4 FY16
Cash & Equiv. ($mil)2130.01975.0
Total Assets ($mil)111005.0109697.0
Total Debt ($mil)50793.047457.0
Equity ($mil)24491.025485.0

Profitability Q4 FY17 Q4 FY16
Gross Profit Margin31.8228.88
EBITDA Margin31.8228.88
Operating Margin18.0715.43
Sales Turnover0.210.18
Return on Assets0.792.27
Return on Equity3.439.6
Debt Q4 FY17 Q4 FY16
Current Ratio0.740.75
Interest Expense446.0404.0
Interest Coverage2.281.98

Share Data Q4 FY17 Q4 FY16
Shares outstanding (mil)1007.6990.39
Div / share0.580.56
Book value / share24.3125.73
Institutional Own % n/a n/a
Avg Daily Volume7574715.04398212.0


BUY. SOUTHERN CO's P/E ratio indicates a significant premium compared to an average of 23.78 for the Electric Utilities industry and a significant premium compared to the S&P 500 average of 25.66. For additional comparison, its price-to-book ratio of 1.81 indicates a discount versus the S&P 500 average of 3.28 and a discount versus the industry average of 1.93. The price-to-sales ratio is below both the S&P 500 average and the industry average, indicating a discount.

1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
SO 52.93 Peers 23.78   SO 6.92 Peers 7.69

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

SO is trading at a significant premium to its peers.


Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

SO is trading at a valuation on par to its peers.

1 2 3 4 5
premium   discount
  Price to
1 2 3 4 5
premium   discount
SO 14.40 Peers 16.22   SO 0.22 Peers 5.44

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

SO is trading at a valuation on par with its peers.


Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

SO trades at a significant discount to its peers.

1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
SO 1.81 Peers 1.93   SO -67.83 Peers 33.67

Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

SO is trading at a valuation on par with its peers.


Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, SO is expected to significantly trail its peers on the basis of its earnings growth rate.

1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
SO 1.92 Peers 2.19   SO 15.75 Peers 9.32

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

SO is trading at a discount to its industry on this measurement.


Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

SO has a sales growth rate that significantly exceeds its peers.



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