Southern (NYSE:SO) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research note issued to investors on Monday.
According to Zacks, “Following continued timing and cost overrun issues over two large construction projects – Vogtle and Kemper – we are recalibrating our investment thesis on Southern Company to Sell from Hold. Despite Georgia PSC's nod for the construction of the half-finished Vogtle nuclear plant expansion in Georgia, doubts remain about the $20 billion initiative that has gone well over budget and is years behind schedule. Southern is also facing challenges to place its Kemper, Mississippi project in service, which suffered yet another setback with the suspension of all coal gasification operations amid additional cost burden. We believe the financial stress from these projects, together with Southern’s hefty expenses to comply with environmental controls/regulations will cause an underperformance in the utility's shares relative to the market as well as the sector in the coming quarters.”
A number of other equities analysts also recently issued reports on SO. Royal Bank of Canada reissued a “buy” rating on shares of Southern in a report on Friday, December 22nd. JPMorgan Chase & Co. assumed coverage on shares of Southern in a report on Friday, January 12th. They issued an “underweight” rating and a $46.00 price objective on the stock. SunTrust Banks set a $49.00 price objective on shares of Southern and gave the stock a “hold” rating in a report on Wednesday, January 3rd. Guggenheim reissued a “buy” rating and issued a $52.00 price objective on shares of Southern in a report on Wednesday, January 3rd. Finally, Mizuho reissued a “buy” rating and issued a $52.00 price objective on shares of Southern in a report on Tuesday, December 26th. Six research analysts have rated the stock with a sell rating, six have given a hold rating and seven have issued a buy rating to the stock. Southern currently has an average rating of “Hold” and an average price target of $51.07.
Southern (NYSE:SO) last announced its quarterly earnings results on Wednesday, November 1st. The utilities provider reported $1.12 EPS for the quarter, topping analysts’ consensus estimates of $1.08 by $0.04. Southern had a net margin of 2.59% and a return on equity of 10.81%. The firm had revenue of $6.20 billion during the quarter, compared to analyst estimates of $6.16 billion. During the same period in the previous year, the business posted $1.27 earnings per share. The business’s revenue for the quarter was down 1.0% on a year-over-year basis. research analysts anticipate that Southern will post 2.96 EPS for the current fiscal year.
In other Southern news, VP James Y. Kerr II sold 25,000 shares of Southern stock in a transaction that occurred on Friday, October 20th. The shares were sold at an average price of $52.16, for a total transaction of $1,304,000.00. Following the transaction, the vice president now owns 26,000 shares of the company’s stock, valued at $1,356,160. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, EVP Christopher C. Womack sold 46,641 shares of Southern stock in a transaction that occurred on Thursday, November 2nd. The shares were sold at an average price of $53.00, for a total transaction of $2,471,973.00. Following the transaction, the executive vice president now directly owns 56,799 shares in the company, valued at approximately $3,010,347. The disclosure for this sale can be found here. Insiders have sold 128,662 shares of company stock worth $6,772,438 in the last ninety days. Insiders own 0.74% of the company’s stock.
Several hedge funds have recently added to or reduced their stakes in SO. Janus Henderson Group PLC lifted its holdings in shares of Southern by 3,580.1% in the second quarter. Janus Henderson Group PLC now owns 4,673,498 shares of the utilities provider’s stock worth $223,766,000 after buying an additional 4,546,503 shares in the last quarter. Capital Research Global Investors lifted its holdings in shares of Southern by 25.3% in the second quarter. Capital Research Global Investors now owns 14,940,226 shares of the utilities provider’s stock worth $715,338,000 after buying an additional 3,015,226 shares in the last quarter. Vanguard Group Inc. lifted its holdings in shares of Southern by 3.3% in the second quarter. Vanguard Group Inc. now owns 71,053,604 shares of the utilities provider’s stock worth $3,402,047,000 after buying an additional 2,295,466 shares in the last quarter. Commonwealth Bank of Australia increased its position in Southern by 1,565.3% in the third quarter. Commonwealth Bank of Australia now owns 1,738,380 shares of the utilities provider’s stock worth $59,048,000 after purchasing an additional 1,633,990 shares during the last quarter. Finally, Franklin Resources Inc. increased its position in Southern by 3.6% in the second quarter. Franklin Resources Inc. now owns 22,379,839 shares of the utilities provider’s stock worth $1,071,547,000 after purchasing an additional 770,413 shares during the last quarter. 53.68% of the stock is currently owned by hedge funds and other institutional investors.
Southern Company Profile
The Southern Company (Southern Company) is a holding company. The Company owns all of the stock of the traditional electric operating companies and the parent entities of Southern Power Company (Southern Power) and Southern Company Gas, and owns other direct and indirect subsidiaries. The Company’s segments include Gas distribution operations, Gas marketing services, Wholesale gas services, Gas midstream operations and All other.
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