Power supplier Southern Company (NYSE:SO) reported second-quarter 2016 earnings per share (excluding certain one-time items) of 74 cents, ahead of the Zacks Consensus Estimate of 69 cents and higher than the year-ago adjusted profit of 71 cents.
The strong numbers can be attributed to robust performance from its wholesale unit.
The Atlanta-based utility’s quarterly revenue – at $4,453 million – came 2.7% higher than the second-quarter 2015 level of $4,337 million but fell just short of the Zacks Consensus Estimate of $4,461 million amid a dip in retail sales.
Overall Sales Breakup
While wholesale sales increased 4.4%, this was partly offset by a decline in Southern Company’s retail electricity demand mild weather conditions. This brought about a slight downward movement in overall electricity sales and usage. Total electricity sales during the second quarter edged down 0.6% from the same period last year.
Southern Company’s total retail sales fell 1.6%, with residential, commercial and industrial sales down by 0.2%, 1.9% and 1.9%, respectively.
Expenses Summary
Southern Company’s operations and maintenance cost remained essentially flat at $1,099 million, while the utility’s total operating expense for the period – at $3,227 million – was also literally unchanged from the prior-year level.
Zacks Rank & Stock Picks
Southern Company – one of the largest generators of electricity in the nation along with the likes of Exelon Corp. (NYSE:EXC) and Duke Energy Corp. (NYSE:DUK) – currently retains a Zacks Rank #3 (Hold).
SOUTHERN CO Price, Consensus and EPS Surprise
SOUTHERN CO Price, Consensus and EPS Surprise | SOUTHERN CO Quote
A better-ranked player from the same industry would be DTE Energy Co. (NYSE:DTE) . This Zacks Rank #2 (Buy) stock offers good value and is worth buying now.
EXELON CORP (EXC): Free Stock Analysis Report
SOUTHERN CO (SO): Free Stock Analysis Report
DUKE ENERGY CP (DUK): Free Stock Analysis Report
DTE ENERGY CO (DTE): Free Stock Analysis Report
Original post
Zacks Investment Research