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Investing.com - Jefferies has reiterated its Buy rating and $100.00 price target on Southern Co . (NYSE:SO), citing the utility’s clear pathway for capital deployment and growth opportunities. The stock, currently trading at $92.75 and near its 52-week high of $94.45, has demonstrated strong momentum with a 21.2% return over the past year. According to InvestingPro analysis, the company appears to be trading above its Fair Value.
The investment firm highlighted Southern’s Georgia Integrated Resource Plan (IRP) stipulation, which creates opportunities to deploy $10-15 billion of upside capital while adding new growth avenues not previously considered in the company’s outlook.
Jefferies noted that the approved 20% reserve margin and coal unit extensions provide immediate capacity relief as data center demand accelerates across Southern’s service territory.
The firm emphasized Southern’s regulatory stability, with its 11.9% return on equity (ROE) band remaining intact through 2028, providing visibility into the company’s financial performance.
These factors collectively support Southern’s projected 6-7% rate base growth extending beyond current planning horizons, according to Jefferies’ analysis of the utility’s long-term prospects. With revenue growth of 9.58% and a beta of just 0.37, Southern demonstrates both growth potential and stability. Discover more detailed insights and 8 additional ProTips for Southern Co. with a subscription to InvestingPro.
In other recent news, Southern Company reported its first-quarter earnings for 2025, surpassing expectations with an earnings per share (EPS) of $1.23, above the forecast of $1.19. The company also reported revenue of $7.78 billion, exceeding the projected $7.31 billion. These results reflect a strong financial performance, driven by investments in state-regulated utilities and favorable weather conditions. In addition, Jefferies analysts upgraded Southern Company’s stock from Hold to Buy, citing strong growth prospects and a potential increase in rate base growth. The analysts noted that Georgia Power, a Southern Company subsidiary, is expected to secure significant capital expenditures, which could drive earnings growth. Furthermore, Southern Company has upsized its offering of convertible senior notes to $1.45 billion, with proceeds aimed at repurchasing existing notes and paying down commercial paper borrowings. Meanwhile, Scotiabank (TSX:BNS) maintained its Sector Outperform rating on Southern Company, emphasizing the company’s consistent earnings growth and strategic positioning. Southern Company’s subsidiaries, Virginia Natural Gas and Chattanooga Gas, have also completed renewable natural gas purchases, expected to significantly reduce emissions.
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