Southern Co. Shows Mixed Earnings Forecast Ahead of Release

Southern Company (SO) is set to release its earnings report, presenting an EPS of $1.31, down from last year. Revenue estimates show slight growth but indicate overall mixed signals ahead, prompting investor interest amidst fluctuating market conditions.

Date: 02-10-2024

AI Rating: 5

In the report, Southern Company (SO) is highlighted as it prepares for an upcoming earnings release. The forecast warns of an EPS of $1.31, reflecting a 7.75% decline compared to the same quarter last year. This may raise concerns among investors as earnings expectations decrease.

However, on the revenue side, the analysis presents a more optimistic view, forecasting net sales of $7.14 billion, which indicates a 2.33% increase from the previous year. This positive revenue outlook could potentially mitigate some fears associated with the lower EPS.

For the annual projections, the EPS estimate stands at $4.02, which aligns with a 10.14% year-on-year increase. The revenue projection at $26.47 billion signifies a 4.8% growth from the prior year, suggesting that while earnings may be slipping in the short term, the company is still on a growth trajectory in revenue.

Southern Company currently has a Zacks Rank of #3 (Hold), suggesting a stable but cautious investment outlook. The Zacks consensus estimates reveal slight upward revisions, hinting at a modest optimism about the company’s operational environment.

In terms of valuation, Southern Company maintains a Forward P/E ratio of 22.45, which is higher than the industry average of 17.91. The PEG ratio of 3.23 also indicates a premium when compared to the industry average of 2.85. Investors may interpret these ratios as an indication of overvaluation relative to growth potential, which could prompt reconsiderations of investment.

Overall, while Southern Company displays mixed signals in its upcoming earnings, the positive revenue growth forecast may offer some comfort to investors, balancing out the negative EPS trends.

Stocks: SO