The Southern Company (SO) Upgraded at Jefferies on Promising Growth Prospects

Jefferies upgraded The Southern Company (NYSE:SO) to Buy from Hold on solid growth outlook, while adjusting the price target from $102 to $100 on June 5.

According to the analysts, Southern Co.’s possible success in future requests for proposals (RFPs) could lead to considerable rate base growth, outperforming industry peers. A Southern Co. subsidiary, Georgia Power, is projected to obtain over 70% of an 8.5 gigawatt project, corresponding to nearly $12.9 billion in extra capital spending.

The Southern Company (SO) Upgraded at Jefferies on Promising Growth Prospects

A technician working with a control panel in a gas distribution center.

Southern Co.’s earnings per share (EPS) are projected to climb at a compound annual growth rate (CAGR) of 7.2% until 2029, and increase to 7.9% through 2035, supported by the forecasted business growth. Analysts added that the regulatory environment is now stable given the settlement of a rate case, and financing is already underway, which limits execution risk. Jefferies reinforced the higher earnings potential at Southern Co. after 2027, which supports the rating adjustment despite the stock trading at a 15% premium.

The Southern Company (NYSE:SO) operates as an integrated energy provider, managing electricity generation and natural gas distribution across major US markets. The company oversees extensive pipeline infrastructure and storage, caters to retail and wholesale customers, and provides advanced energy solutions like micro-grids and digital communications.

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