SOUTHERN CO - SO 4.2 10/15/60 (SOJE) Stock Fundamental Analysis
NYSE:SOJE - New York Stock Exchange, Inc. - US8425878837 - Currency: USD
SOJE gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 46 industry peers in the Electric Utilities industry. While SOJE has a great profitability rating, there are quite some concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on SOJE.
1. Profitability
1.1 Basic Checks
SOJE had positive earnings in the past year.
SOJE had a positive operating cash flow in the past year.
In the past 5 years SOJE has always been profitable.
In the past 5 years SOJE always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of SOJE (3.11%) is better than 76.09% of its industry peers.
Looking at the Return On Equity, with a value of 13.61%, SOJE belongs to the top of the industry, outperforming 86.96% of the companies in the same industry.
SOJE has a Return On Invested Capital of 4.64%. This is amongst the best in the industry. SOJE outperforms 82.61% of its industry peers.
The Average Return On Invested Capital over the past 3 years for SOJE is significantly below the industry average of 45.26%.
The 3 year average ROIC (4.14%) for SOJE is below the current ROIC(4.64%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.11% | ||
| ROE | 13.61% | ||
| ROIC | 4.64% |
ROA(3y)2.83%
ROA(5y)2.58%
ROE(3y)12.5%
ROE(5y)11.4%
ROIC(3y)4.14%
ROIC(5y)4.02%
1.3 Margins
SOJE has a Profit Margin of 16.54%. This is amongst the best in the industry. SOJE outperforms 86.96% of its industry peers.
SOJE's Profit Margin has declined in the last couple of years.
The Operating Margin of SOJE (26.40%) is better than 86.96% of its industry peers.
SOJE's Operating Margin has been stable in the last couple of years.
SOJE's Gross Margin of 89.46% is amongst the best of the industry. SOJE outperforms 91.30% of its industry peers.
In the last couple of years the Gross Margin of SOJE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 26.4% | ||
| PM (TTM) | 16.54% | ||
| GM | 89.46% |
OM growth 3Y5.39%
OM growth 5Y1.06%
PM growth 3Y16.73%
PM growth 5Y-5.73%
GM growth 3Y0.95%
GM growth 5Y0.39%
2. Health
2.1 Basic Checks
SOJE has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
SOJE has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for SOJE remains at a similar level compared to 5 years ago.
The debt/assets ratio for SOJE is higher compared to a year ago.
2.2 Solvency
SOJE has an Altman-Z score of 0.57. This is a bad value and indicates that SOJE is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of SOJE (0.57) is worse than 65.22% of its industry peers.
SOJE has a debt to FCF ratio of 653.53. This is a negative value and a sign of low solvency as SOJE would need 653.53 years to pay back of all of its debts.
SOJE has a better Debt to FCF ratio (653.53) than 78.26% of its industry peers.
SOJE has a Debt/Equity ratio of 1.88. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.88, SOJE is not doing good in the industry: 60.87% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.88 | ||
| Debt/FCF | 653.53 | ||
| Altman-Z | 0.57 |
ROIC/WACC0.95
WACC4.89%
2.3 Liquidity
SOJE has a Current Ratio of 0.86. This is a bad value and indicates that SOJE is not financially healthy enough and could expect problems in meeting its short term obligations.
SOJE has a Current ratio of 0.86. This is in the better half of the industry: SOJE outperforms 63.04% of its industry peers.
SOJE has a Quick Ratio of 0.86. This is a bad value and indicates that SOJE is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.64, SOJE perfoms like the industry average, outperforming 56.52% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.64 |
3. Growth
3.1 Past
SOJE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.79%, which is quite good.
Measured over the past 5 years, SOJE shows a small growth in Earnings Per Share. The EPS has been growing by 5.48% on average per year.
Looking at the last year, SOJE shows a quite strong growth in Revenue. The Revenue has grown by 9.58% in the last year.
SOJE shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.53% yearly.
EPS 1Y (TTM)9.79%
EPS 3Y5.99%
EPS 5Y5.48%
EPS Q2Q%19.42%
Revenue 1Y (TTM)9.58%
Revenue growth 3Y4.96%
Revenue growth 5Y4.53%
Sales Q2Q%16.99%
3.2 Future
Based on estimates for the next years, SOJE will show a small growth in Earnings Per Share. The EPS will grow by 7.33% on average per year.
The Revenue is expected to grow by 4.75% on average over the next years.
EPS Next Y8.47%
EPS Next 2Y7.57%
EPS Next 3Y7.44%
EPS Next 5Y7.33%
Revenue Next Year4.26%
Revenue Next 2Y4.17%
Revenue Next 3Y3.99%
Revenue Next 5Y4.75%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
SOJE is valuated cheaply with a Price/Earnings ratio of 4.13.
Compared to the rest of the industry, the Price/Earnings ratio of SOJE indicates a rather cheap valuation: SOJE is cheaper than 97.83% of the companies listed in the same industry.
SOJE is valuated cheaply when we compare the Price/Earnings ratio to 26.70, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 3.75, the valuation of SOJE can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of SOJE indicates a rather cheap valuation: SOJE is cheaper than 95.65% of the companies listed in the same industry.
SOJE's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.49.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.13 | ||
| Fwd PE | 3.75 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SOJE indicates a rather cheap valuation: SOJE is cheaper than 95.65% of the companies listed in the same industry.
SOJE's Price/Free Cash Flow ratio is rather cheap when compared to the industry. SOJE is cheaper than 80.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 184.52 | ||
| EV/EBITDA | 6.67 |
4.3 Compensation for Growth
SOJE's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
SOJE has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)0.49
PEG (5Y)0.75
EPS Next 2Y7.57%
EPS Next 3Y7.44%
5. Dividend
5.1 Amount
SOJE has a Yearly Dividend Yield of 3.39%. Purely for dividend investing, there may be better candidates out there.
SOJE's Dividend Yield is comparable with the industry average which is at 3.45.
Compared to an average S&P500 Dividend Yield of 2.36, SOJE pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.39% |
5.2 History
The dividend of SOJE has a limited annual growth rate of 1.87%.
SOJE has been paying a dividend for over 5 years, so it has already some track record.
The dividend of SOJE decreased in the last 3 years.
Dividend Growth(5Y)1.87%
Div Incr Years1
Div Non Decr Years2
5.3 Sustainability
64.20% of the earnings are spent on dividend by SOJE. This is not a sustainable payout ratio.
SOJE's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP64.2%
EPS Next 2Y7.57%
EPS Next 3Y7.44%
17.61
+0.03 (+0.17%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners70.79%
Inst Owner ChangeN/A
Ins Owners0.09%
Ins Owner ChangeN/A
Market Cap19.37B
Analysts72.86
Price Target18.53 (5.22%)
Short Float %0%
Short Ratio0.2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.39% |
Yearly Dividend2.69
Dividend Growth(5Y)1.87%
DP64.2%
Div Incr Years1
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-2.2%
Min EPS beat(2)-4.33%
Max EPS beat(2)-0.07%
EPS beat(4)2
Avg EPS beat(4)3.82%
Min EPS beat(4)-4.33%
Max EPS beat(4)16.06%
EPS beat(8)6
Avg EPS beat(8)4.48%
EPS beat(12)9
Avg EPS beat(12)5.63%
EPS beat(16)11
Avg EPS beat(16)4.5%
Revenue beat(2)2
Avg Revenue beat(2)4.99%
Min Revenue beat(2)4.69%
Max Revenue beat(2)5.3%
Revenue beat(4)3
Avg Revenue beat(4)2.44%
Min Revenue beat(4)-3.09%
Max Revenue beat(4)5.3%
Revenue beat(8)3
Avg Revenue beat(8)-6.24%
Revenue beat(12)7
Avg Revenue beat(12)2.05%
Revenue beat(16)10
Avg Revenue beat(16)2.99%
PT rev (1m)-2.36%
PT rev (3m)-15.28%
EPS NQ rev (1m)-15.33%
EPS NQ rev (3m)-16.81%
EPS NY rev (1m)-0.24%
EPS NY rev (3m)-0.73%
Revenue NQ rev (1m)0.05%
Revenue NQ rev (3m)0.7%
Revenue NY rev (1m)0.24%
Revenue NY rev (3m)0.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.13 | ||
| Fwd PE | 3.75 | ||
| P/S | 0.7 | ||
| P/FCF | 184.52 | ||
| P/OCF | 1.99 | ||
| P/B | 0.57 | ||
| P/tB | 0.68 | ||
| EV/EBITDA | 6.67 |
EPS(TTM)4.26
EY24.19%
EPS(NY)4.7
Fwd EY26.68%
FCF(TTM)0.1
FCFY0.54%
OCF(TTM)8.84
OCFY50.21%
SpS25.32
BVpS30.76
TBVpS25.77
PEG (NY)0.49
PEG (5Y)0.75
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.11% | ||
| ROE | 13.61% | ||
| ROCE | 5.47% | ||
| ROIC | 4.64% | ||
| ROICexc | 4.72% | ||
| ROICexgc | 4.92% | ||
| OM | 26.4% | ||
| PM (TTM) | 16.54% | ||
| GM | 89.46% | ||
| FCFM | 0.38% |
ROA(3y)2.83%
ROA(5y)2.58%
ROE(3y)12.5%
ROE(5y)11.4%
ROIC(3y)4.14%
ROIC(5y)4.02%
ROICexc(3y)4.18%
ROICexc(5y)4.06%
ROICexgc(3y)4.38%
ROICexgc(5y)4.26%
ROCE(3y)4.95%
ROCE(5y)4.79%
ROICexcg growth 3Y6.47%
ROICexcg growth 5Y1.27%
ROICexc growth 3Y6.72%
ROICexc growth 5Y1.53%
OM growth 3Y5.39%
OM growth 5Y1.06%
PM growth 3Y16.73%
PM growth 5Y-5.73%
GM growth 3Y0.95%
GM growth 5Y0.39%
F-Score6
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.88 | ||
| Debt/FCF | 653.53 | ||
| Debt/EBITDA | 4.97 | ||
| Cap/Depr | 177.66% | ||
| Cap/Sales | 34.55% | ||
| Interest Coverage | 2.85 | ||
| Cash Conversion | 76.17% | ||
| Profit Quality | 2.28% | ||
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.64 | ||
| Altman-Z | 0.57 |
F-Score6
WACC4.89%
ROIC/WACC0.95
Cap/Depr(3y)182.47%
Cap/Depr(5y)184.04%
Cap/Sales(3y)32.2%
Cap/Sales(5y)32.89%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)9.79%
EPS 3Y5.99%
EPS 5Y5.48%
EPS Q2Q%19.42%
EPS Next Y8.47%
EPS Next 2Y7.57%
EPS Next 3Y7.44%
EPS Next 5Y7.33%
Revenue 1Y (TTM)9.58%
Revenue growth 3Y4.96%
Revenue growth 5Y4.53%
Sales Q2Q%16.99%
Revenue Next Year4.26%
Revenue Next 2Y4.17%
Revenue Next 3Y3.99%
Revenue Next 5Y4.75%
EBIT growth 1Y17.81%
EBIT growth 3Y10.62%
EBIT growth 5Y5.63%
EBIT Next Year82.06%
EBIT Next 3Y27.66%
EBIT Next 5Y21.45%
FCF growth 1Y103.75%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y75.14%
OCF growth 3Y16.63%
OCF growth 5Y11.11%