Electric utility firm Southern Company ( SO ) reported first
quarter 2013 earnings per share (excluding certain one-time
charges) of 49 cents, below the Zacks Consensus Estimate of 51
cents. The weaker-than-expected results could be attributed to
spiraling expenses. BROOKFIELD INFR (BIP): Free Stock Analysis
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ReportSOUTHN COMPANY (SO): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment
However, the company's adjusted per share profits came ahead of
the first quarter 2012 level of 42 cents, amid higher energy
The Atlanta, Georgia-based power supplier's quarterly revenue - at
$3,897.0 million - came 8.1% higher than the first quarter 2012
level of $3,604.0 million and also surpassed the Zacks Consensus
Estimate of $3,744.0 million.
Near-normal temperatures across Southern Company's core Southeast
market, as against the unusually warm last one, boosted electricity
demand for heating. This brought about an upward movement in
overall electricity sales and usage. Total electricity sales during
the first quarter improved 4.9% from the same period last
Total retail sales rose by 2.3%, reflecting higher demand from
residential customers, which increased by 8.3%. Commercial sales
registered a year-over-year upward movement of 1.2%.
However, industrial sales were down 2.1%, negatively influencing
Southern Company's first quarter results. With approximately a
third of the company's total retail sales coming from industrial
customers, direction of the economy significantly affects the
fortunes of Southern Company, as compared to other utilities that
are less dependent on the industrial component.
Southern Company's operations and maintenance expense increased
slightly - by 0.7% year over year - the first quarterly rise
following two successive decreases. Additionally, Southern
Company's total operating expense for the period, at $3,572.0
million, was approximately 25.9% higher than the prior-year
Southern Company management indicated that it continues to see
positive indications of economic growth in the Southeast region but
admitted that pace remained slow.
Southern Company currently carries a Zacks Rank #3 (Hold),
implying that it is expected to perform in line with the broader
U.S. equity market over the next one to three months.
However, there are certain other electric utility stocks like
Brookfield Infrastructure Partners L.P. ( BIP ), Huaneng
Power International Inc. ( HNP ) and Pike
Electric Corp. ( PIKE ) that offer
tremendous value and are worth buying now. All these companies
sport a Zacks Rank #1 (Strong Buy).