The Southern Company
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
The oversold condition that drove the prior buy call has largely resolved, with SO recovering from $82.89 to $86.15 and RSI normalizing to 51.8 from 21.5 as of 8 Oct.
Fundamentals are mixed: FY2025 revenue grew 10.6% but EPS declined 1.8% to $3.92, while FCF remained deeply negative at -$2.935B against $74.075B in total debt and capex of $12.737B. An EV/EBITDA discount of -13.7% to peers and consecutive earnings surprises of 11.9% and 9.1% in the most recent quarters are constructive, but rising Treasury yields pressuring dividend utilities and persistent insider net selling of -92,870 shares over 24 months temper conviction. Hold while awaiting either a reclaim of the $88.41 50-day MA or evidence the capex build is converting into sustained FCF improvement.
What could go wrong
- Interest-rate sensitivity. Rising Treasury yields are pressuring dividend and utility stocks per recent news coverage, a direct headwind for a regulated electric trading near peer-median valuations.
- Persistent negative FCF. FY2025 FCF of -$2.935B (FCF margin -9.9%) driven by $12.737B in capex shows the heavy build cycle is still consuming cash ahead of earnings conversion.
- High leverage. Total debt of $74.075B versus stockholders' equity of $36.016B leaves limited balance-sheet flexibility if rate environment stays elevated.
- Insider distribution. Net insider selling of -92,870 shares (-$8.79M) over the trailing 24 months, with zero open-market acquisitions and 16 dispositions, signals limited insider confidence at current levels.
What would change my mind
Where this comes from: technicals, 8 Oct · prior verdict · FY25 fundamentals · peer comparison. Orin's read on SO; not advice.
How has the share price moved?
Down 2.9% over twelve months, from $95.40 on 27 Oct 2025 to $92.65 at the Tue 27 Oct 2026 close. Its highest close in that time was $99.11 on 16 Mar 2026; the last close is 6.5% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 20.4M, on 18 Jun 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All SO filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $8.9B | 0.1% |
| Vanguard Capital Management | $7.1B | 0.2% |
| State Street | $6.2B | 0.2% |
| Capital World Investors | $6.0B | 0.7% |
| T. Rowe Price Associates | $4.4B | 0.4% |
| JPMorgan Chase | $3.2B | 0.2% |
| Geode Capital Management | $2.8B | 0.2% |
| Vanguard Portfolio Management | $2.6B | 0.1% |
| FMR | $2.2B | 0.1% |
| Franklin Resources | $1.6B | 0.3% |
123 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 281 Form 4 filings; open-market trades net −$8.8M. Of the 50 on hand, 0 were open-market purchases and 8 sales — the rest are grants, option exercises and tax withholding.
Ask Orin about SO
Orin answers questions about SO from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 21.3× its last 12 months of profit (Thu 5 Nov close) — higher than in 2 of its last 5 fiscal years (middle 21.8×); the typical Utilities company on the NYSE is at 18.5×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 21.3×near usual | 21.8× | 18.5× |
| P/S | 3.44×above usual | 3.15× | — |
| EV/EBITDA | 12.0×near usual | 11.9× | — |
| P/B | 2.6×near usual | 2.6× | — |
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $94.95 (from $74 to $106) — 2% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$94.95
$74 – $106 · +2% against the last close
- 5 buy or overweight
- 10 hold
- 2 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 21.3× its last 12 months of profit; the middle P/E of the 9 companies it is compared to that made a profit is 21.3×.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| SOThe Southern Company | $107B | 21.3× | 12.0× | 49.7% | 16.0% | 13% |
| CMSCMS Energy Corporation | $22B | 24.2× | 13.6× | 77.2% | 9.7% | 8% |
| CNPCenterPoint Energy, Inc. | $28B | 24.0× | 12.4× | 53.3% | 11.8% | 10% |
| DTEDTE Energy Company | $28B | 30.9× | 7.4× | 37.2% | 5.5% | 7% |
| DUKDuke Energy Corporation | $101B | 19.0× | 11.1× | 60.5% | 15.9% | 10% |
| EDConsolidated Edison, Inc. | $45B | 19.3× | 9.5× | 65.5% | 12.7% | 9% |
| ETREntergy Corporation | $52B | 27.4× | 14.5× | 38.9% | 13.5% | 10% |
| EXCExelon Corporation | $46B | 16.3× | 10.7× | 24.5% | 11.0% | 10% |
| PEGPublic Service Enterprise Group Incorporated | $36B | 18.0× | 13.5× | 85.4% | 16.0% | 12% |
| XELXcel Energy Inc. | $49B | 21.3× | 13.3× | 48.8% | 15.3% | 10% |
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 21.3× its last 12 months of profit (Thu 5 Nov close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now21.3×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Utilities companies on the NYSE were priced at a typical 18.5× their yearly profit (Tue 27 Oct close).
- Now18.5×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $21 a share — 77% below the $92.25 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $21 | 77% below $92.25 |
- Levered: comes out below zero, so it is not shown.
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.