Southern (SO) Downgraded by Zacks Investment Research to “Sell”
Southern (NYSE:SO) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research report issued to clients and 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 research firms also recently weighed in on SO. Bank of America reaffirmed an “underperform” rating and set a $51.00 price target on shares of Southern in a research report on Tuesday, October 24th. SunTrust Banks reaffirmed a “hold” rating and set a $52.00 price target on shares of Southern in a research report on Friday, October 20th. Mizuho reaffirmed a “buy” rating and set a $55.00 price target on shares of Southern in a research report on Friday, December 8th. Citigroup reaffirmed a “sell” rating and set a $44.00 price target (up previously from $43.00) on shares of Southern in a research report on Tuesday, October 3rd. Finally, Royal Bank of Canada raised Southern from a “sector perform” rating to an “outperform” rating and set a $53.00 price target for the company in a research report on Friday, September 29th. Six investment analysts have rated the stock with a sell rating, six have issued a hold rating and seven have issued a buy rating to the company. The stock currently has a consensus rating of “Hold” and an average price target of $51.20.
Southern (NYSE:SO) last released its quarterly earnings results on Wednesday, November 1st. The utilities provider reported $1.12 earnings per share for the quarter, topping analysts’ consensus estimates of $1.08 by $0.04. Southern had a return on equity of 10.81% and a net margin of 2.59%. The firm had revenue of $6.20 billion during the quarter, compared to the consensus estimate of $6.16 billion. During the same quarter in the prior year, the firm posted $1.27 EPS. The business’s revenue was down 1.0% on a year-over-year basis. sell-side analysts expect that Southern will post 2.96 earnings per share for the current year.
In other Southern news, insider Art P. Beattie sold 46,941 shares of the stock in a transaction on Thursday, October 26th. The stock was sold at an average price of $52.50, for a total transaction of $2,464,402.50. Following the transaction, the insider now owns 59,494 shares in the company, valued at approximately $3,123,435. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. Also, VP James Y. Kerr II sold 25,000 shares of the 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 transaction, the vice president now owns 26,000 shares in the company, valued at approximately $1,356,160. The disclosure for this sale can be found here. In the last 90 days, insiders sold 128,662 shares of company stock worth $6,772,438. 0.74% of the stock is owned by company insiders.
Hedge funds have recently bought and sold shares of the business. Chicago Partners Investment Group LLC bought a new position in Southern during the 2nd quarter worth $100,000. Farmers & Merchants Trust Co of Chambersburg PA bought a new position in shares of Southern in the third quarter worth $105,000. Monroe Bank & Trust MI increased its position in shares of Southern by 17.9% in the second quarter. Monroe Bank & Trust MI now owns 2,300 shares of the utilities provider’s stock worth $110,000 after purchasing an additional 350 shares during the period. AlphaMark Advisors LLC increased its position in shares of Southern by 0.6% in the second quarter. AlphaMark Advisors LLC now owns 2,363 shares of the utilities provider’s stock worth $113,000 after purchasing an additional 14 shares during the period. Finally, Fieldpoint Private Securities LLC bought a new position in shares of Southern in the third quarter worth $118,000. Hedge funds and other institutional investors own 53.68% of the company’s stock.
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.
For more information about research offerings from Zacks Investment Research, visit Zacks.com
Receive News & Ratings for Southern Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Southern and related companies with MarketBeat.com's FREE daily email newsletter.