The Southern Company
The Southern Company Fundamental Analysis
The Southern Company (SOMN) shows moderate financial fundamentals with a PE ratio of 13.13, profit margin of 15.42%, and ROE of 13.11%. The company generates $28.9B in annual revenue with N/A year-over-year growth of N/A.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 32.5/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze SOMN's fundamental strength across five key dimensions:
Efficiency Score
WeakSOMN struggles to generate sufficient returns from assets.
Valuation Score
ModerateSOMN shows balanced valuation metrics.
Growth Score
WeakSOMN faces weak or negative growth trends.
Financial Health Score
WeakSOMN carries high financial risk with limited liquidity.
Profitability Score
WeakSOMN struggles to sustain strong margins.
Key Financial Metrics
Is SOMN Expensive or Cheap?
P/E Ratio
SOMN trades at 13.13 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, SOMN's PEG of 3.41 indicates potential overvaluation.
Price to Book
The market values The Southern Company at 1.67 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at -0.83 times EBITDA. This is generally considered low.
How Well Does SOMN Make Money?
Net Profit Margin
For every $100 in sales, The Southern Company keeps $15.42 as profit after all expenses.
Operating Margin
Core operations generate 25.68 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $13.11 in profit for every $100 of shareholder equity.
ROA
The Southern Company generates $2.91 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
The Southern Company generates strong operating cash flow of $9.39B, reflecting robust business health.
Free Cash Flow
The Southern Company generates weak or negative free cash flow of $-1.82B, restricting financial flexibility.
FCF Per Share
Each share generates $-1.65 in free cash annually.
FCF Yield
SOMN converts -3.11% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
13.13
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
3.41
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.67
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.03
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
2.11
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.75
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.13
vs 25 benchmark
ROA
Return on assets percentage
0.03
vs 25 benchmark
ROCE
Return on capital employed
0.05
vs 25 benchmark
How SOMN Stacks Against Its Sector Peers
| Metric | SOMN Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 13.13 | 19.20 | Better (Cheaper) |
| ROE | 13.11% | 1033.00% | Weak |
| Net Margin | 15.42% | 9191.00% | Weak |
| Debt/Equity | 2.11 | 6.63 | Strong (Low Leverage) |
| Current Ratio | 0.75 | 1.68 | Weak Liquidity |
| ROA | 2.91% | -237.00% (disorted) | Weak |
SOMN outperforms its industry in 2 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews The Southern Company's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
N/A
Industry Style: Defensive, Dividend, Income
EPS CAGR
N/A
Industry Style: Defensive, Dividend, Income
FCF CAGR
N/A
Industry Style: Defensive, Dividend, Income