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Research

Research Alert: CFRA Reiterates Hold Opinion On Shares Of The Southern Company

CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:We lift our 12-month target by $1 to $101, 22.0x our next-12-month EPS view of $4.59, above its five-year forward average of 19.7x. We lift our 2026 EPS view by $0.02 to $4.57 and initiate our 2027 EPS view at $4.92. SO announced that 23 GW of its 75+ GW large-load pipeline are either contracted (11 GW) or in late-stage/finalizing phases (12 GW), with data centers representing most of this activity. We think the sizable pipeline provides strong visibility into sustained 8%+ rate base growth through 2030 and beyond, above its historical 5-6% growth. In our view, the $26.5B DOE loan de-risks the company's capital structure, as these loans provide low-cost (Treasury +37.5 bps), long-duration (30-year) capital that removes refinancing risk for the majority of the 10 GW of new regulated generation currently under construction. We see EPS growth (~7.3% CAGR from 2025 to 2030) approximating that of its peers, but we anticipate that dividend growth, at just a 3.2% CAGR, will trail peers over the same time span.

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Sectors

Sector Update: Energy Stocks Rise Late Afternoon

Energy stocks were higher late Thursday afternoon, with the NYSE Energy Sector Index gaining 1% and the State Street Energy Select Sector SPDR ETF (XLE) up 0.8%.The Philadelphia Oil Service Sector Index advanced 0.4%, and the Dow Jones US Utilities Index climbed 2.4%.West Texas Intermediate crude oil fell 2% to $104.75 a barrel, and global benchmark Brent dropped 3.4% to $114.01 a barrel. Henry Hub natural gas futures rose 4.4% to $2.76 per 1 million BTU.In sector news, US natural gas stocks rose by 79 billion cubic feet in the week ended April 24, slower than the 83 billion increase expected in a Bloomberg survey and following an increase of 103 billion cubic feet in the previous week.In corporate news, Southern (SO) shares climbed 2.6% after it reported Q1 adjusted EPS of $1.32, up from $1.23 a year ago. Analysts polled by FactSet expected $1.21.Apollo Global Management (APO), Blackstone (BX) and KKR (KKR) are among the final bidders for a major stake in Shell's (SHEL) LNG Canada project in a deal that could top $10 billion and reach as much as $15 billion, Reuters reported. Shell shares rose 2.1%.TotalEnergies (TTE) and partner Nextnorth have reached financial close and broke ground on a 440 MWp solar power plant in Ilagan, Philippines, the companies said. TotalEnergies shares added 1.4%.BP (BP) has signed an agreement with Venezuela to explore offshore natural gas, as the country's energy sector gathers momentum following the US capture of Nicolas Maduro in January, Bloomberg reported. BP shares were up 1.2%.

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Sectors

Sector Update: Energy

Energy stocks rose late Thursday afternoon, with the NYSE Energy Sector Index gaining 1% and the State Street Energy Select Sector SPDR ETF (XLE) up 0.8%.The Philadelphia Oil Service Sector Index advanced 0.4%, and the Dow Jones US Utilities Index climbed 2.4%.West Texas Intermediate crude oil fell 2% to $104.75 a barrel, and global benchmark Brent dropped 3.4% to $114.01 a barrel. Henry Hub natural gas futures rose 4.4% to $2.76 per 1 million BTU.In corporate news, Southern (SO) shares climbed 2.9% after it reported Q1 adjusted net income Thursday of $1.32 per share, up from $1.23 a year earlier. Analysts polled by FactSet expected $1.21.

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Commodities

Southern Company Q1 Sales Climb to 50 TWh as Generation, Pipeline Grow

Southern Company (SO) reported Q1 results Thursday, showing total generation of 47 terrawatt-hours, up from 46 TWh a year earlier, the company said.The company purchased 4 TWh of power for the quarter ended March 31, down from 5 TWh a year earlier, the company added.Southern Company reported total electricity sales of 50.19 TWh in the quarter, up from 48.49 TWh a year earlier.The company reported total retail electricity sales of 36.60 TWh for the quarter, compared with 36.44 TWh a year earlier.Residential sales totaled 12.12 TWh in Q1, down from 12.63 TWh a year earlier, according to the company.Commercial electricity sales reached 12.34 TWh in the quarter, rising from 11.85 TWh a year earlier, while industrial sales increased to 12 TWh from 11.82 TWh, the company said.The company reported total wholesale sales of 13.59 TWh for the quarter, compared with 12.04 TWh a year earlier.Southern Company is advancing about 10 gigawatt of new regulated generation under construction alongside a broader 23 GW project pipeline across contracted and late-stage developments, the company said.The company continues to scale its large-load pipeline, with over 11 GW of contracted demand and roughly 6 GW of projects nearing final agreements, while total prospective opportunities exceed 75 GW, it said.The company is building new infrastructure across thermal, storage and solar segments, targeting capacity additions of about 1.2 GW in 2026, rising to 2.8 GW annually by 2030, it added.On the renewable side, the company placed the 0.20 GW Millers Branch solar Phase I into service in February, with an additional 0.31 GW across Phases II and III expected later in 2026, the company said.The company is also repowering five wind facilities totaling about 1 GW, with projects underway across Oklahoma and Texas and expected to come online through 2026 and 2027.The company plans to expand gas-fired capacity by about 0.40 GW through uprates across plants in Alabama and Georgia, with construction starting in 2026 and operations targeted between 2029 and 2031.Southern Company continues to advance regulatory processes to secure between 2 GW and 6 GW of additional generation and is progressing an all-source procurement targeting new capacity by 2033, the company added.Price: $95.76, Change: $+2.25, Percent Change: +2.41%

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Research

Research Alert: Southern Company Q1: Wholesale Electric Fuels Top- And Bottom-line Beats

CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:Southern Company reported Q1 2026 adjusted EPS of $1.32, up 7.3% Y/Y, and beating guidance by 10.0% and consensus by 9.1%. Operating revenues increased 8.0% (+3.6% vs. consensus) to $8.4B, attributed to wholesale electric revenues surging 29.7% to $965M and natural gas revenues rising 19.1% to $2.2B. The company added 49K customers Y/Y, reflecting 1.1% growth, while weather-adjusted retail sales increased 2.3%, with strong commercial (+4.6%) and industrial (+1.5%) performance. Weather impacts reduced quarterly EPS by $0.05 as actual residential sales declined 4.1%. Southern Power faced significant headwinds, with net income falling 95.4% to $4M due to $154M in accelerated depreciation charges from wind facility repowering projects, with additional charges of $335M expected through 2026 and $100M in 2027. We believe the strong underlying utility performance and customer growth trends support the investment thesis despite near-term Southern Power challenges.

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Wire

BMO Capital Adjusts Southern Price Target to $104 From $103, Maintains Outperform Rating

Southern Company (SO) has an average rating of Hold and mean price target of $103.09, according to analysts polled by FactSet.Price: $92.69, Change: $+0.77, Percent Change: +0.84%

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Wire

Southern Raises Quarterly Dividend to $0.76 a Share From $0.74, Payable June 8 to Shareholders of Record May 18

Southern Raises Quarterly Dividend to $0.76 a Share From $0.74, Payable June 8 to Shareholders of Record May 18

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Commodities

NWS Warns of Fire Weather Conditions in Southern Plains, Southeast; Pacific System to Impact California

The US National Weather Service on Monday said the Southern Plains and southeast will remain under fire weather conditions, while Northern and Central California will experience rain and mountain snow due to a Pacific storm system.The effect of the Pacific system may be felt in Pacific Northwest, Great Basin, and Southern California on Tuesday.The NWS issued a red flag warning early Monday for parts of Minnesota, including Roseau, Thief River Falls, Bemidji, Hibbing, Duluth, Ely, International Fall, Detroit Lakes, Fergus Falls, Brainerd, Hinckley, Wheaton, Morris, St. Cloud, Willmar, Minneapolis, Marshall, Pipestone, Windom, Worthington, and Mankato. The cities' main service providers are Otter Tail's (OTTR) power unit, Allette (ALE) subsidiary Minnesota Power, Xcel Energy (XEL) and Alliant Energy (LNT).In South Dakota, areas under the same warning were Sisseton, Milbank, Watertown, Brookings, Sioux Falls, Custer, Hot Springs, Edgemont, Pine Ridge, Martin, Hermosa, Wall, Kadoka, White River, Winner, Mission, Kadoka, and Murdo. Otter Tail Power, Xcel Energy, NorthWestern Energy (NWE), and Black Hills (BKH) unit Black Hills Energy primarily serve these cities.A similar warning was posted for Nebraska's Harrison, Chadron, Rushville, Alliance, Scottsbluff, Bridgeport, Harrisburg, Kimball, Sidney, Oshkosh, Chappell, Hyannis, Arthur, Orgallala, Mullen, Tryon, Valentine, Thedford, Stapleton, North Platte, Stockville, Springview, Ainsworth, Brewster, Broken Bow, North Platte, Lexington, Butte, ONeill, Burwell, Kearney, Holdrege, Ord, Grand Island, Hastings, Aurora, Columbus, York, Hebron, and Superior.In Wyoming, areas under a red flag warning include Newcastle, Wright, Gillette, Lander, Rock Springs, Bill, Lance Creek, Lusk, Glenrock, Casper, Douglas, Glendo, Torrington, Wheatland, Chugwater, Pine Bluffs, and Cheyenne. These are primarily served by PacifiCorp's Rocky Mountain Power and Black Hills Energy.The NWS issued the same warning for Colorado's Leadville, Buena Vista, Salida, Woodland Park, Colorado Springs, Pikes Peak, Canon City, Pueblo, Westcliffe, Saguache, South Fork, La Veta Pass, Alamosa, San Luis, Trinidad, Kim, La Junta, Eads, Lamar, and Springfield, within Black Hills Energy's and Xcel Energy's service areas.In Kansas, Phillipsburg, Concordia, Beloit, Garden City, and Ulysses, primarily served by Evergy (EVRG), were also under a similar warning.The same warning was posted for Georgia's Blairsville, Toccoa, Gainesville, Albany, Tifton, Moultrie, Bainbridge, Valdosta, and Waycross, primarily served by Georgia Power, a Southern Co. (SO) subsidiary.In Florida, the agency placed Jacksonville, Lake City, Gainesville, Ocala, Perry, Cross City, Tallahassee, Marianna, Panama City, Apalachicola, and De Funiak Springs under a similar warning. Duke Energy (DUK), NextEra Energy (NEE) unit Florida Power & Light, and Chesapeake Utilities' (CPK) Florida Public Utilities are the cities' main service providers.Alabama's Dothan and Troy, within the service area of Southern Co.'s Alabama Power, were also issued the same warning.The NWS posted a freeze warning for most parts of Ohio. The state's main electricity providers are AES' (AES) Ohio unit, American Electric Power's Ohio unit, Duke Energy, and First Energy (FE) subsidiaries, Ohio Edison, Toledo Edison and Illuminating Co.In West Virginia, Morgantown, Fairmont, Clarksburg, Elkins, Parkersburg, Sutton, Snowshoe, Beckley, Lewisburg, Bluefield, and Martinsburg were placed under a similar warning. The state is primarily served by American Electric Power's Appalachian Power and First Energy subsidiaries, Mon Power and Potomac Edison.The same warning was issued for Virginia's Leesburg, Winchester, Warrenton, Luray, Dale City, Fredericksburg, Culpeper, Warrenton, Harrisonburg, Staunton, Charlottesville, Farmville, Lynchburg, Roanoke, Danville, and Wytheville, which are mainly served by Appalachian Power and Dominion Energy (D).The whole of Maryland, except Oakland and Cumberland, was under a similar warning. The main service providers in the state are Potomac Edison and Exelon's (EXC) Pepco, BGE, and Delmarva Power.The states of Delaware and New Jersey were issued the same warning. Delmarva Power primarily serves Delaware, while FirstEnergy's Jersey Central Power & Light, Public Service Enterprise's (PEG) Electric and Gas Co., Exelon's Atlantic City Electric, and Consolidated Edison's (ED) Orange and Rockland serve New Jersey.A freeze warning was also posted for North Carolina's Boone, within Duke Energy's service zone, and Colorado's Craig, Steamboat Springs, Meeker, Rangely, Vail, and Rifle.The NWS issued a similar warning for most of Pennsylvania, excluding Scranton. The state's main service providers are Duquesne Light, PPL's (PPL) Electric Utilities unit, UGI's (UGI) Utilities unit, Exelon's Peco, First Energy units, Penelec, Penn Power, West Penn Power, and Met-Ed.New York's Middletown, Newburgh, Peekskill, Islip, Riverhead, and Montauk, were under the same warning. The cities' main service providers are Public Service Enterprise's Long Island unit, Consolidated Edison's Co. of New York and Orange and Rockland, and Avangrid (AGR) units, Rochester Gas and Electric and New York State Electric & Gas.In Connecticut, Danbury, Stanford, Bridgeport, New Haven, Middletown, and New London were issued the same warning. Eversource Energy, PPL's Rhode Island Energy, and Avangrid's The United Illuminating Co. mainly serve these areas.In Michigan, a freeze warning was posted for Muskegon, Alma, Ionia, Grand Rapids, Holland, Hastings, Lansing, South Haven, Kalamazoo, Benton Harbor, Jackson, Flint, Saginaw, Port Huron, Detroit, Ann Arbor, and Coldwater. The state is primarily served by CMS Energy's (CMS) Consumers Energy, DTE Energy (DTE), American Electric Power's Indiana Michigan Power, Upper Peninsula Power, Xcel Energy, and WEC Energy (WEC) subsidiaries, Upper Michigan Energy Resources and We Energies.A similar warning was issued for Indiana's Gary, Rensselaer, South Bend, Angola, Plymouth, Warsaw, Fort Wayne, Marion, Kokomo, Logansport, Rensselaer, Crawfordsville, Indianapolis, and Muncie, which are within the service zones of Duke Energy, Indiana Michigan Power, AES' Indiana unit, and NiSource's (NI) Northern Indiana Public Service Co.In Illinois, the same warning was posted for Freeport, Rockford, Waukegan, Dixon, DeKalb, Aurora, Joliet, Ottawa, Pontiac, Kankakee, Peoria, Bloomington, Peru, Kewanee, Galesburg, Peoria, Pekin, Canton, Macomb, Havana, Lincoln, Champaign, Decatur, Danville, and Charleston. The main electricity providers in these areas are Ameren's (AEE) Illinois unit, Exelon's ComEd, and Berkshire Hathaway Energy's (BRK.B) MidAmerican Energy.Iowa's Fort Dodge, Ames, Waterloo, Marshalltown, Cedar Rapids, Iowa City, Ottumwa, Dubuque, Clinton, Davenport, Burlington, and Keokuk, within the service area of Alliant Energy and MidAmerican Energy, were also placed under a similar warning.The NWS issued a flood warning for areas near Washington's Winthrop, served by Puget Sound Energy.A similar warning was posted for areas near Ohio's Defiance and cities close to Indiana's South Bend, Fort Wayne, Angola, and Plymouth.The same warning was issued for parts of Illinois' Waukegan, Rockford, Freeport, Aurora, Dixon, Clinton, Ottawa, Peoria, Pekin, Canton, Carbondale, and Havana, and areas near Iowa's Clinton, Davenport, Burlington, Iowa City, and Cedar Rapids.In Michigan, areas under the same warning include parts of Petoskey, Alpena, Rogers City, Mio, Tawas City, Traverse City, Houghton Lake, Cadillac Manistee, Ludington, Pentwater, Muskegon, Mount Pleasant, Grand Rapids, Ionia, Hastings, Lansing, Kalamazoo, Houghton, Marquette, Escanaba, Iron Mountain, and Menominee.In Wisconsin, areas near Appleton, Wisconsin Dells, Prairie Du Chien, Beaver Dam, Milwaukee, Kenosha, Janesville, and Mineral Point were issued a similar warning. The state's main electricity providers are Xcel Energy, Alliant Energy, MGE Energy's (MGEE) Madison Gas and Electric, and WEC Energy subsidiaries, Wisconsin Public Service and We Energies.Missouri's Nevada, Kansas' Coffeyville and Oklahoma's Grove, primarily served by Evergy and Algonquin Power & Utilities' (AQN) Liberty, were also placed under the same warning.

$AEE$AES$AGR$ALE$AQN$BKH$BRK.B$CPK$D$DTE$DUK$ED$EVRG$EXC$FE$LNT$MGEE$NEE$NI$NWE$OTTR$PEG$PPL$SO$UGI$WEC$XEL
Research

Seaport Global Downgrades Southern Company to Neutral From Buy

Southern Company (SO) has an average rating of hold and mean price target of $103.67, according to analysts polled by FactSet.

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Wire

Southern Company's PowerSecure to Develop Wyoming Energy Storage, Solar Project

Southern Company's (SO) PowerSecure unit said Friday it is collaborating with Powder River Energy and the NRTC to develop a utility-scale battery storage and solar project in Wyoming.The project, expected to reduce annual wholesale power costs by up to $1 million, aims to manage peak grid demand caused by regional industrial and rural growth while providing backup capacity during outages.Construction is expected to take about two years, with the system targeted to be operational in 2027.The planned installation features a 5-megawatt battery system holding 21.6 megawatt-hours of capacity alongside a 1.25-megawatt ground-mounted solar array, Southern said.Shares of the company were down 1.2% in Friday trading.Price: $93.79, Change: $-1.11, Percent Change: -1.17%

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Commodities

NWS Warns of Heavy Rains, Flash Flooding in Hawaii; Heavy Snow in Sierra Nevada

The US National Weather Service on Sunday said Hawaii is expected to experience heavy rainfall through Monday, which could lead to flash flooding.Parts of Texas, the southern Plains and the Upper Great Lakes may encounter severe thunderstorms and heavy rains.Meanwhile, in California, heavy mountain snow is expected to continue in Sierra Nevada, with rain and gusty winds likely at lower elevations. The Marianas is expected to be affected by Super Typhoon Sinlaku through mid-week.The NWS early Monday issued a red flag warning for New Mexico's Raton, Clayton, Roy, and Las Vegas. TXNM Energy (TXNM) unit Public Service Co. of New Mexico and Xcel Energy (XEL) are among the primary electricity suppliers in the state.A similar warning was raised for the following places in Texas: Amarillo, Perryton, Dalhart, Dumas, Borger, Pampa, Hereford, Clarendon, Dimmitt, Plainview, and Littlefield. These places are primarily served by Xcel Energy and American Electric Power's (AEP) Texas unit.Dalton, Blairsville, and Rome in Georgia, which primarily falls under the service area of Southern Company (SO) unit Georgia Power, were also placed under a red flag warning watch.Also covered under a similar watch were Nebraska's Holdrege, Hebron, Hastings, Kearney, Aurora, Grand Island, Lexington, Broken Bow, North Platte, Ord, York, Harrison, Chadron, Alliance, Scottsbluff, Bridgeport, Harrisburg, Kimball, Sidney, Burwell, Rushville, Alliance, Chappell, Hyannis, Arthur, Ogallala, Valentine, Thedford, Tryon, Stapleton, Springview, Ainsworth Brewster, Butte, and O'Neill. The state is mostly served by the regional transmission organization Southwest Power Pool, with Midcontinent ISO also covering some areas.Oklahoma's Boise City, Guymon and Beaver were also covered under a similar watch. OGE Energy (OGE) unit Oklahoma Gas & Electric and American Electric Power (AEP) subsidiary Public Service Co. of Oklahoma are the major electric utility service providers in the state.In Colorado, a fire weather conditions warning was issued for Leadville, Buena Vista, Salida, Saguache, South Fork, Alamosa, La Veta Pass, San Luis, Canon City, Pikes Peak, Westcliffe, Pueblo, Limon, Colorado Springs, Woodland Park, Eads, La Junta, Kim, Springfield, Trinidad, Lamar, Fort Collins, Georgetown, Fairplay, Castle Rock, Deer Trail, and Sterling. The state is primarily served by Xcel Energy and Black Hills (BKH) unit Black Hills Energy.A red flag warning was also issued for Wyoming's Wright, Bill, Glenrock, Casper, Douglas, Lance Creek, Lusk, Glendo, Torrington, Garrett, Wheatland, Chugwater, Pine Bluffs, Cheyenne, Gillette, and Newcastle. PacifiCorp's Rocky Mountain Power is the major electricity provider in the state.South Dakota's Sturgis, Faith, Hill City, Rapid City, Custer, Hermosa, Wall, Phillip, Hot Springs, Edgemont, Pine Ridge, Kadoka, Philip, White River, Martin, Mission, Winner, Pierre, and Murdo. Most of these places are served by Black Hills Energy.In Kansas, a red flag warning was raised for Tribune, Scott City, Garden City, Ulysses, Dodge City, Liberal, Russell, Lincoln, Ellsworth, Great Bend, Anthony, Medicine Lodge, Hutchinson, Kingman, Oakley, Concordia, Salina, and Hill City. A flood warning was raised for areas near Concordia. Evergy (EVRG) is among the major electric utility service providers in the state.Flood warnings were also raised for certain pockets of Iowa, Illinois, Indiana, Wisconsin, Michigan and Washington, while a flash flood warning was issued for San Saba in Texas.

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