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Southern Company Buy rating maintained but target price cut 7% due to higher near-term capital spending

Analyst Insights
14 Oct 2026
Seeking Alpha
View Source
Neutral
Southern Company Buy rating maintained but target price cut 7% due to higher near-term capital spending

Southern Company retains a Buy rating, but its target price is lowered by 7% to $97 due to increased near-term capital expenditures. The company faces strong long-term demand from data centers, yet connection delays and high capital spending will pressure free cash flow and limit short-term gains. Management forecasts 8-9% adjusted EPS growth through 2028, supported by regulated asset base expansion and $81 billion planned CapEx. Despite high debt and capital spending constraining dividend growth, Southern Company's stable regulated business and 25-year dividend streak make it an attractive investment.

Southern Company shares are trading at USD 88.07 on Pluang, slightly down by 0.05% as of Oct 14, 2026 21:12 WIB. The stock has a dividend yield of 3.45% and a market cap of $101.36 billion, reflecting steady investor interest despite near-term cash flow pressures.

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