The Southern Company (SOMN)
Valuation Overview•Is The Southern Company Overvalued or Undervalued?
The market is pricing the stock in line with historical averages, assuming steady-state growth.
Fragile underlying quality score of 38/100; weak margins or elevated debt leverage warrant caution.
Wall Street forecasts a balanced outlook with consensus price targets near the current price.
Verdict: Highly distressed profile flashing severe fundamental warning signs.
Wall Street sentiment is generally neutral alongside robust expected earnings growth. This outlook is strongly supported by highly attractive capital returns, anchored by a strong, well-covered dividend yield.
SOMN demonstrates adequate business quality with stable profitability. However, this is severely offset by a highly leveraged balance sheet (Debt/EBITDA > 4.0x) and elevated financial risk.
The company maintains stable top-line performance paired with stable bottom-line earnings. The company maintains healthy operational efficiency with a 24.2% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $8.4B | — | — | — | — | |
| EBITDA | $3.6B | — | — | — | — | |
| Net Income | $1.4B | — | — | — | — | |
| EPS (Diluted) | $1.20 | — | — | — | — | |
| Free Cash Flow | -$1.7B | — | — | — | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 48.0% | 48.5% | 48.5% | 48.5% |
| Operating Margin | 24.2% | 24.7% | 24.7% | 24.7% |
| Net Margin | 14.5% | 14.7% | 14.7% | 14.7% |
| FCF Margin | -11.5% | -9.9% | -9.9% | -9.9% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $1.21 | $1.32 | +9.1% | ||
| Q1'26 | $0.56 | $0.55 | -1.4% |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about The Southern Company (SOMN) valuation, health, and returns.
The Southern Company valuation is being assessed using available models.
Valuation anchors are currently not available.
The Southern Company displays weak financial health with a composite quality score of 38/100, supported by a Piotroski F-Score of 8/9, Return on Invested Capital (ROIC) of 4.9%.
The Southern Company pays a 5.5% dividend yield, covered by a 69% payout ratio with 0 years of growth, supplemented by a 0.0% buyback yield.
The Southern Company's current growth trajectory is Stable. The company achieved N/A 1Y revenue growth and N/A 1Y EPS growth, compared to its 3Y revenue CAGR of N/A.
Wall Street consensus is Hold based on 0 analysts. The consensus price target represents a N/A change from current levels.
Investment risks for The Southern Company include: -6.2% 1-year max drawdown. Volatility risk is characterized by a beta of 1.00x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.