Zacks Investment Research lowered shares of Southern (NYSE:SO) from a buy rating to a hold rating in a research report sent to investors on Wednesday.
According to Zacks, “SO is one of the largest and best-managed electric utility holding companies in the U.S. with good rate base growth and constructive regulation. We expect it to generate steady earnings and dividend growth in the coming years through its long-term power contracts. Additionally, the utility's $12 billion AGL Resources has significantly increased its customer base and diversified its offerings. Further, the company’s Vogtle Project also received approval from Georgia PSC. However, the decision to continue with the project may increase the credit risk of the company. As it is , the cost overrun issues over its Vogtle and Kemper projects continue to weigh on SO’s already weak financials. High leverage of over 60% poses major roadblock in the growth of the company. Thus we take a cautious stance on the prospects of the stock.”
SO has been the topic of several other reports. Bank of America reiterated an underperform rating and issued a $51.00 price target on shares of Southern in a report on Tuesday, October 24th. SunTrust Banks reiterated a hold rating and issued a $52.00 price target on shares of Southern in a report on Friday, October 20th. Mizuho reiterated a buy rating and issued a $55.00 price target on shares of Southern in a report on Friday, December 8th. Jefferies Group reiterated a buy rating and issued a $56.00 price target (up from $55.00) on shares of Southern in a report on Tuesday, September 12th. Finally, Guggenheim upgraded Southern from a neutral rating to a buy rating and increased their price target for the stock from $49.00 to $56.00 in a report on Thursday, September 14th. Three research analysts have rated the stock with a sell rating, seven have assigned a hold rating and eight have given a buy rating to the company. The company currently has a consensus rating of Hold and an average price target of $49.59.
Southern (NYSE:SO) last posted its 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. The company had revenue of $6.20 billion for the quarter, compared to the consensus estimate of $6.16 billion. Southern had a return on equity of 10.81% and a net margin of 2.59%. The firm’s revenue for the quarter was down 1.0% on a year-over-year basis. During the same period in the previous year, the business earned $1.27 earnings per share. analysts anticipate that Southern will post 2.96 EPS for the current fiscal year.
The company also recently disclosed a quarterly dividend, which was paid on Wednesday, December 6th. Investors of record on Monday, November 20th were paid a $0.58 dividend. The ex-dividend date of this dividend was Friday, November 17th. This represents a $2.32 annualized dividend and a yield of 4.83%. Southern’s dividend payout ratio (DPR) is currently 414.29%.
In other Southern news, CEO William P. Bowers sold 85,151 shares of the stock in a transaction on Tuesday, October 10th. The stock was sold at an average price of $50.00, for a total transaction of $4,257,550.00. The sale was disclosed in a legal filing with the SEC, which is accessible through the SEC website. Also, VP James Y. Kerr II sold 25,000 shares of the firm’s stock in a transaction on Friday, October 20th. The stock was sold at an average price of $52.16, for a total value of $1,304,000.00. Following the completion of the sale, the vice president now directly owns 26,000 shares of the company’s stock, valued at approximately $1,356,160. The disclosure for this sale can be found here. In the last three months, insiders sold 213,813 shares of company stock worth $11,029,988. 0.74% of the stock is owned by insiders.
Institutional investors have recently bought and sold shares of the company. Chicago Partners Investment Group LLC purchased a new position in Southern in the 2nd quarter worth $100,000. Farmers & Merchants Trust Co of Chambersburg PA purchased a new position in shares of Southern during the 3rd quarter valued at about $105,000. Monroe Bank & Trust MI raised its stake in shares of Southern by 17.9% during the 2nd quarter. Monroe Bank & Trust MI now owns 2,300 shares of the utilities provider’s stock valued at $110,000 after buying an additional 350 shares during the last quarter. AlphaMark Advisors LLC raised its stake in shares of Southern by 0.6% during the 2nd quarter. AlphaMark Advisors LLC now owns 2,363 shares of the utilities provider’s stock valued at $113,000 after buying an additional 14 shares during the last quarter. Finally, Fieldpoint Private Securities LLC purchased a new position in shares of Southern during the 3rd quarter valued at about $118,000. 53.66% of the stock is owned by hedge funds and other institutional investors.
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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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