SRE vs SO

For growth investors, The Southern Company (SO) is the stronger pick with 10.

6% revenue growth year-over-year, versus 5. 7% for Sempra (SRE). The Southern Company (SO) offers the better valuation at 24. 5x trailing P/E (21. 0x forward), making it the more compelling value choice. Analysts rate Sempra (SRE) a "Buy" — based on 25 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, The Southern Company (SO) is the cheapest at 24.

5x versus Sempra at 29. 8x. On forward P/E, Sempra is actually cheaper at 18. 5x — notably different from the trailing picture, reflecting expected earnings growth.

Over the past 5 years, The Southern Company (SO) delivered a total return of +67.

9%, compared to +57. 1% for Sempra (SRE). Over 10 years, the gap is even starker: SO returned +140. 8% versus SRE's +119. 2%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), The Southern Company (SO) is the lower-risk stock at -0.

15β versus Sempra's 0. 37β — meaning SRE is approximately -346% more volatile than SO relative to the S&P 500. On balance sheet safety, Sempra (SRE) carries a lower debt/equity ratio of 83% versus 169% for The Southern Company — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), The Southern Company (SO) is pulling ahead at 10.

6% versus 5. 7% for Sempra (SRE). On earnings-per-share growth, the picture is similar: The Southern Company grew EPS -1. 8% year-over-year, compared to -28. 3% for Sempra. Over a 3-year CAGR, SO leads at 0. 3% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

Sempra (SRE) is the more profitable company, earning 15.

1% net margin versus 14. 7% for The Southern Company — meaning it keeps 15. 1% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: SO leads at 24. 6% versus 15. 9% for SRE. At the gross margin level — before operating expenses — SRE leads at 52. 1%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

On forward earnings alone, Sempra (SRE) trades at 18.

5x forward P/E versus 21. 0x for The Southern Company — 2. 5x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for SRE: 13. 4% to $107. 00.

All stocks in this comparison pay dividends.

The Southern Company (SO) offers the highest yield at 2. 8%, versus 2. 6% for Sempra (SRE).

For long-horizon retirement investors, The Southern Company (SO) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β -0.

15), 2. 8% yield, +140. 8% 10Y return). Both have compounded well over 10 years (SO: +140. 8%, SRE: +119. 2%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Utilities sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.