Southern Co (SO): Today's Featured Utilities Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Southern ( SO) pushed the Utilities sector higher today making it today's featured utilities winner. The sector as a whole closed the day up 0.6%. By the end of trading, Southern rose 53 cents (1.2%) to $43.29 on average volume. Throughout the day, 5.4 million shares of Southern exchanged hands as compared to its average daily volume of 4.4 million shares. The stock ranged in a price between $42.49-$43.31 after having opened the day at $42.76 as compared to the previous trading day's close of $42.76. Other companies within the Utilities sector that increased today were: Active Power ( ACPW), up 4.2%, GreenHunter Energy ( GRH), up 3.8%, Chesapeake Utilities ( CPK), up 3.5%, and American DG Energy ( ADGE), up 2.9%.
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The Southern Company operates as an electric utility company. It is involved in the generation, transmission, and distribution of electricity through coal, nuclear, oil and gas, and hydro resources. Southern has a market cap of $37.4 billion and is part of the utilities industry. The company has a P/E ratio of 16.8, below the S&P 500 P/E ratio of 17.7. Shares are down 7.6% year to date as of the close of trading on Wednesday. Currently there are two analysts that rate Southern a buy, two analysts rate it a sell, and 12 rate it a hold.

TheStreet Ratings rates Southern as a buy. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins, growth in earnings per share, notable return on equity and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

On the negative front, Centrais Eletricas Brasileiras ( EBR.B), down 7%, U.S. Geothermal ( HTM), down 5%, RGC Resources ( RGCO), down 3.3%, and Centrais Eletricas Brasileiras ( EBR), down 3.1%, were all laggards within the utilities sector with EQT ( EQT) being today's utilities sector laggard.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the utilities sector could consider Utilities Select Sector SPDR ( XLU) while those bearish on the utilities sector could consider ProShares UltraShort Utilities ( SDP).

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