Intrinsic value of Southern - SO

Previous Close

$44.22

  Intrinsic Value

$17.23

stock screener

  Rating & Target

str. sell

-61%

Previous close

$44.22

 
Intrinsic value

$17.23

 
Up/down potential

-61%

 
Rating

str. sell

We calculate the intrinsic value of SO stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 44.2

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  3.60
  3.74
  3.87
  3.98
  4.08
  4.17
  4.26
  4.33
  4.40
  4.46
  4.51
  4.56
  4.60
  4.64
  4.68
  4.71
  4.74
  4.77
  4.79
  4.81
  4.83
  4.85
  4.86
  4.88
  4.89
  4.90
  4.91
  4.92
  4.93
  4.93
Revenue, $m
  23,860
  24,752
  25,709
  26,732
  27,824
  28,985
  30,218
  31,527
  32,913
  34,380
  35,932
  37,570
  39,300
  41,125
  43,050
  45,078
  47,215
  49,466
  51,835
  54,329
  56,953
  59,713
  62,617
  65,670
  68,880
  72,255
  75,802
  79,531
  83,449
  87,566
Variable operating expenses, $m
  17,321
  17,942
  18,608
  19,320
  20,079
  20,887
  21,746
  22,657
  23,622
  24,643
  25,008
  26,149
  27,353
  28,623
  29,963
  31,374
  32,862
  34,428
  36,077
  37,813
  39,639
  41,560
  43,581
  45,706
  47,940
  50,289
  52,758
  55,353
  58,080
  60,946
Fixed operating expenses, $m
  392
  401
  410
  419
  428
  438
  447
  457
  467
  477
  488
  499
  510
  521
  532
  544
  556
  568
  581
  593
  606
  620
  633
  647
  662
  676
  691
  706
  722
  738
Total operating expenses, $m
  17,713
  18,343
  19,018
  19,739
  20,507
  21,325
  22,193
  23,114
  24,089
  25,120
  25,496
  26,648
  27,863
  29,144
  30,495
  31,918
  33,418
  34,996
  36,658
  38,406
  40,245
  42,180
  44,214
  46,353
  48,602
  50,965
  53,449
  56,059
  58,802
  61,684
Operating income, $m
  6,147
  6,410
  6,692
  6,994
  7,316
  7,660
  8,025
  8,413
  8,825
  9,260
  10,436
  10,923
  11,438
  11,982
  12,555
  13,160
  13,798
  14,470
  15,178
  15,923
  16,708
  17,533
  18,402
  19,317
  20,278
  21,290
  22,353
  23,472
  24,647
  25,883
EBITDA, $m
  10,290
  10,681
  11,101
  11,550
  12,029
  12,540
  13,082
  13,658
  14,269
  14,916
  15,600
  16,323
  17,086
  17,892
  18,742
  19,639
  20,584
  21,579
  22,627
  23,731
  24,893
  26,115
  27,402
  28,755
  30,178
  31,674
  33,248
  34,902
  36,640
  38,468
Interest expense (income), $m
  1,100
  2,743
  2,921
  3,103
  3,298
  3,507
  3,730
  3,966
  4,218
  4,485
  4,768
  5,067
  5,384
  5,718
  6,071
  6,443
  6,836
  7,250
  7,686
  8,145
  8,628
  9,137
  9,672
  10,235
  10,827
  11,450
  12,105
  12,794
  13,517
  14,278
  15,077
Earnings before tax, $m
  3,404
  3,489
  3,589
  3,696
  3,809
  3,930
  4,059
  4,195
  4,340
  4,493
  5,368
  5,539
  5,720
  5,911
  6,112
  6,324
  6,548
  6,784
  7,033
  7,295
  7,571
  7,861
  8,167
  8,489
  8,828
  9,185
  9,560
  9,954
  10,369
  10,806
Tax expense, $m
  919
  942
  969
  998
  1,029
  1,061
  1,096
  1,133
  1,172
  1,213
  1,449
  1,496
  1,544
  1,596
  1,650
  1,708
  1,768
  1,832
  1,899
  1,970
  2,044
  2,123
  2,205
  2,292
  2,384
  2,480
  2,581
  2,688
  2,800
  2,918
Net income, $m
  2,485
  2,547
  2,620
  2,698
  2,781
  2,869
  2,963
  3,062
  3,168
  3,280
  3,919
  4,044
  4,176
  4,315
  4,462
  4,617
  4,780
  4,953
  5,134
  5,325
  5,527
  5,739
  5,962
  6,197
  6,445
  6,705
  6,979
  7,267
  7,570
  7,888

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  115,266
  119,577
  124,200
  129,142
  134,413
  140,023
  145,982
  152,304
  159,001
  166,089
  173,582
  181,499
  189,856
  198,673
  207,971
  217,770
  228,093
  238,966
  250,412
  262,459
  275,135
  288,470
  302,496
  317,246
  332,754
  349,057
  366,194
  384,205
  403,134
  423,025
Adjusted assets (=assets-cash), $m
  115,266
  119,577
  124,200
  129,142
  134,413
  140,023
  145,982
  152,304
  159,001
  166,089
  173,582
  181,499
  189,856
  198,673
  207,971
  217,770
  228,093
  238,966
  250,412
  262,459
  275,135
  288,470
  302,496
  317,246
  332,754
  349,057
  366,194
  384,205
  403,134
  423,025
Revenue / Adjusted assets
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
Average production assets, $m
  85,729
  88,936
  92,374
  96,050
  99,970
  104,142
  108,574
  113,276
  118,257
  123,529
  129,102
  134,990
  141,206
  147,764
  154,679
  161,967
  169,645
  177,731
  186,244
  195,204
  204,632
  214,550
  224,982
  235,952
  247,486
  259,611
  272,357
  285,753
  299,831
  314,625
Working capital, $m
  692
  718
  746
  775
  807
  841
  876
  914
  954
  997
  1,042
  1,090
  1,140
  1,193
  1,248
  1,307
  1,369
  1,435
  1,503
  1,576
  1,652
  1,732
  1,816
  1,904
  1,998
  2,095
  2,198
  2,306
  2,420
  2,539
Total debt, $m
  54,093
  57,464
  61,079
  64,944
  69,066
  73,453
  78,113
  83,057
  88,294
  93,836
  99,697
  105,887
  112,423
  119,318
  126,588
  134,251
  142,324
  150,826
  159,777
  169,198
  179,111
  189,539
  200,507
  212,041
  224,168
  236,917
  250,319
  264,404
  279,206
  294,761
Total liabilities, $m
  90,138
  93,509
  97,124
  100,989
  105,111
  109,498
  114,158
  119,102
  124,339
  129,881
  135,742
  141,932
  148,468
  155,363
  162,633
  170,296
  178,369
  186,871
  195,822
  205,243
  215,156
  225,584
  236,552
  248,086
  260,213
  272,962
  286,364
  300,449
  315,251
  330,806
Total equity, $m
  25,128
  26,068
  27,076
  28,153
  29,302
  30,525
  31,824
  33,202
  34,662
  36,207
  37,841
  39,567
  41,389
  43,311
  45,338
  47,474
  49,724
  52,095
  54,590
  57,216
  59,979
  62,887
  65,944
  69,160
  72,540
  76,094
  79,830
  83,757
  87,883
  92,219
Total liabilities and equity, $m
  115,266
  119,577
  124,200
  129,142
  134,413
  140,023
  145,982
  152,304
  159,001
  166,088
  173,583
  181,499
  189,857
  198,674
  207,971
  217,770
  228,093
  238,966
  250,412
  262,459
  275,135
  288,471
  302,496
  317,246
  332,753
  349,056
  366,194
  384,206
  403,134
  423,025
Debt-to-equity ratio
  2.150
  2.200
  2.260
  2.310
  2.360
  2.410
  2.450
  2.500
  2.550
  2.590
  2.630
  2.680
  2.720
  2.750
  2.790
  2.830
  2.860
  2.900
  2.930
  2.960
  2.990
  3.010
  3.040
  3.070
  3.090
  3.110
  3.140
  3.160
  3.180
  3.200
Adjusted equity ratio
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218
  0.218

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  2,485
  2,547
  2,620
  2,698
  2,781
  2,869
  2,963
  3,062
  3,168
  3,280
  3,919
  4,044
  4,176
  4,315
  4,462
  4,617
  4,780
  4,953
  5,134
  5,325
  5,527
  5,739
  5,962
  6,197
  6,445
  6,705
  6,979
  7,267
  7,570
  7,888
Depreciation, amort., depletion, $m
  4,143
  4,272
  4,409
  4,556
  4,713
  4,880
  5,057
  5,245
  5,444
  5,655
  5,164
  5,400
  5,648
  5,911
  6,187
  6,479
  6,786
  7,109
  7,450
  7,808
  8,185
  8,582
  8,999
  9,438
  9,899
  10,384
  10,894
  11,430
  11,993
  12,585
Funds from operations, $m
  6,628
  6,818
  7,029
  7,254
  7,494
  7,749
  8,020
  8,308
  8,612
  8,935
  9,083
  9,443
  9,824
  10,225
  10,649
  11,095
  11,566
  12,062
  12,584
  13,133
  13,712
  14,321
  14,961
  15,635
  16,344
  17,089
  17,873
  18,697
  19,563
  20,473
Change in working capital, $m
  24
  26
  28
  30
  32
  34
  36
  38
  40
  43
  45
  48
  50
  53
  56
  59
  62
  65
  69
  72
  76
  80
  84
  89
  93
  98
  103
  108
  114
  119
Cash from operations, $m
  6,604
  6,792
  7,001
  7,224
  7,462
  7,715
  7,984
  8,270
  8,572
  8,892
  9,038
  9,396
  9,774
  10,172
  10,593
  11,037
  11,504
  11,997
  12,515
  13,061
  13,636
  14,241
  14,877
  15,547
  16,251
  16,991
  17,770
  18,589
  19,449
  20,354
Maintenance CAPEX, $m
  -3,310
  -3,429
  -3,557
  -3,695
  -3,842
  -3,999
  -4,166
  -4,343
  -4,531
  -4,730
  -4,941
  -5,164
  -5,400
  -5,648
  -5,911
  -6,187
  -6,479
  -6,786
  -7,109
  -7,450
  -7,808
  -8,185
  -8,582
  -8,999
  -9,438
  -9,899
  -10,384
  -10,894
  -11,430
  -11,993
New CAPEX, $m
  -2,980
  -3,206
  -3,438
  -3,676
  -3,920
  -4,172
  -4,432
  -4,702
  -4,981
  -5,271
  -5,573
  -5,888
  -6,216
  -6,558
  -6,915
  -7,288
  -7,678
  -8,086
  -8,513
  -8,960
  -9,428
  -9,918
  -10,432
  -10,970
  -11,534
  -12,126
  -12,746
  -13,396
  -14,078
  -14,794
Cash from investing activities, $m
  -6,290
  -6,635
  -6,995
  -7,371
  -7,762
  -8,171
  -8,598
  -9,045
  -9,512
  -10,001
  -10,514
  -11,052
  -11,616
  -12,206
  -12,826
  -13,475
  -14,157
  -14,872
  -15,622
  -16,410
  -17,236
  -18,103
  -19,014
  -19,969
  -20,972
  -22,025
  -23,130
  -24,290
  -25,508
  -26,787
Free cash flow, $m
  314
  157
  5
  -147
  -300
  -456
  -614
  -775
  -940
  -1,109
  -1,477
  -1,656
  -1,842
  -2,034
  -2,232
  -2,439
  -2,653
  -2,875
  -3,107
  -3,349
  -3,600
  -3,863
  -4,136
  -4,422
  -4,721
  -5,034
  -5,360
  -5,702
  -6,059
  -6,433
Issuance/(repayment) of debt, $m
  3,300
  3,371
  3,615
  3,865
  4,122
  4,387
  4,660
  4,943
  5,237
  5,543
  5,860
  6,191
  6,535
  6,895
  7,271
  7,663
  8,073
  8,502
  8,951
  9,421
  9,913
  10,428
  10,968
  11,534
  12,127
  12,749
  13,401
  14,085
  14,802
  15,555
Issuance/(repurchase) of shares, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  3,300
  3,371
  3,615
  3,865
  4,122
  4,387
  4,660
  4,943
  5,237
  5,543
  5,860
  6,191
  6,535
  6,895
  7,271
  7,663
  8,073
  8,502
  8,951
  9,421
  9,913
  10,428
  10,968
  11,534
  12,127
  12,749
  13,401
  14,085
  14,802
  15,555
Total cash flow (excl. dividends), $m
  3,615
  3,528
  3,620
  3,718
  3,822
  3,931
  4,046
  4,168
  4,297
  4,433
  4,384
  4,535
  4,694
  4,862
  5,038
  5,224
  5,420
  5,627
  5,844
  6,072
  6,313
  6,566
  6,832
  7,112
  7,406
  7,716
  8,041
  8,383
  8,743
  9,121
Retained Cash Flow (-), $m
  -961
  -940
  -1,008
  -1,077
  -1,149
  -1,223
  -1,299
  -1,378
  -1,460
  -1,545
  -1,634
  -1,726
  -1,822
  -1,922
  -2,027
  -2,136
  -2,251
  -2,370
  -2,495
  -2,626
  -2,763
  -2,907
  -3,058
  -3,215
  -3,381
  -3,554
  -3,736
  -3,927
  -4,126
  -4,336
Prev. year cash balance distribution, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  2,654
  2,588
  2,613
  2,641
  2,673
  2,708
  2,747
  2,790
  2,837
  2,888
  2,750
  2,809
  2,872
  2,939
  3,011
  3,088
  3,170
  3,256
  3,348
  3,446
  3,549
  3,659
  3,774
  3,896
  4,025
  4,161
  4,305
  4,457
  4,617
  4,785
Discount rate, %
  9.70
  10.19
  10.69
  11.23
  11.79
  12.38
  13.00
  13.65
  14.33
  15.05
  15.80
  16.59
  17.42
  18.29
  19.21
  20.17
  21.17
  22.23
  23.34
  24.51
  25.74
  27.02
  28.38
  29.79
  31.28
  32.85
  34.49
  36.21
  38.03
  39.93
PV of cash for distribution, $m
  2,419
  2,132
  1,926
  1,725
  1,531
  1,344
  1,168
  1,003
  850
  711
  548
  445
  356
  280
  216
  163
  121
  88
  62
  43
  29
  19
  12
  7
  4
  3
  1
  1
  0
  0
Current shareholders' claim on cash, %
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

The Southern Company (Southern Company) is a holding company. The Company owns all of the stock of the traditional electric operating companies and the parent entities of Southern Power Company (Southern Power) and Southern Company Gas, and owns other direct and indirect subsidiaries. The Company's segments include Gas distribution operations, Gas marketing services, Wholesale gas services, Gas midstream operations and All other. The Gas distribution operations segment includes natural gas local distribution utilities that construct, manage, and maintain intrastate natural gas pipelines and gas distribution facilities in seven states. The Gas marketing services segment provides natural gas commodity and related services to customers markets that provide for customer choice. The Wholesale gas services segment engages in natural gas storage and gas pipeline arbitrage. The Gas midstream operations consist primarily of gas pipeline investments, with storage and fuels.

FINANCIAL RATIOS  of  Southern (SO)

Valuation Ratios
P/E Ratio 17.6
Price to Sales 2.2
Price to Book 1.7
Price to Tangible Book
Price to Cash Flow 8.9
Price to Free Cash Flow -18.1
Growth Rates
Sales Growth Rate 13.8%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -1.1%
Cap. Spend. - 3 Yr. Gr. Rate 6%
Financial Strength
Quick Ratio 0
Current Ratio 0.1
LT Debt to Equity 167.3%
Total Debt to Equity 186.2%
Interest Coverage 4
Management Effectiveness
Return On Assets 3.5%
Ret/ On Assets - 3 Yr. Avg. 3.7%
Return On Total Capital 4.1%
Ret/ On T. Cap. - 3 Yr. Avg. 4.5%
Return On Equity 10.7%
Return On Equity - 3 Yr. Avg. 10.6%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 37.7%
EBITDA Margin - 3 Yr. Avg. 36.5%
Operating Margin 23.3%
Oper. Margin - 3 Yr. Avg. 22.5%
Pre-Tax Margin 17.5%
Pre-Tax Margin - 3 Yr. Avg. 18.2%
Net Profit Margin 12.5%
Net Profit Margin - 3 Yr. Avg. 12.5%
Effective Tax Rate 27.3%
Eff/ Tax Rate - 3 Yr. Avg. 30.9%
Payout Ratio 84.4%

SO stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SO stock intrinsic value calculation we used $23031 million for the last fiscal year's total revenue generated by Southern. The default revenue input number comes from 0001 income statement of Southern. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our SO stock valuation model: a) initial revenue growth rate of 3.6% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 9.7%, whose default value for SO is calculated based on our internal credit rating of Southern, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Southern.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of SO stock the variable cost ratio is equal to 72.7%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $384 million in the base year in the intrinsic value calculation for SO stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Southern.

Corporate tax rate of 27% is the nominal tax rate for Southern. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the SO stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for SO are equal to 359.3%.

Life of production assets of 25 years is the average useful life of capital assets used in Southern operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for SO is equal to 2.9%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $24167 million for Southern - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 999 million for Southern is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Southern at the current share price and the inputted number of shares is $44.2 billion.

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COMPANY NEWS

▶ Southern Company announces quarterly dividend   [Oct-15-18 03:47PM  PR Newswire]
▶ Power restored to 365,000 Georgia Power customers   [Oct-14-18 10:02AM  PR Newswire]
▶ Power restored to 352,000 Georgia Power customers   [Oct-13-18 05:18PM  PR Newswire]
▶ Alabama Power Dividends Declared   [11:54AM  PR Newswire]
▶ Preparation is key for Hurricane Michael   [03:30PM  PR Newswire]
▶ Georgia Power CEO Paul Bowers given Four Pillar award (Photos)   [Oct-05-18 03:07PM  American City Business Journals]
▶ Georgia Power applies first of three refunds to its customers   [Oct-03-18 01:06PM  American City Business Journals]
▶ Duke Energy mulls selling minority stake in commercial renewables portfolio   [Sep-26-18 05:55PM  American City Business Journals]
▶ Plant Vogtle expansion gets green light to continue   [05:04PM  American City Business Journals]
▶ Stocks That Fell to 3-Year Lows in the Week of Sept. 21   [Sep-22-18 11:36PM  GuruFocus.com]
▶ [$$] Growing Opposition Threatens Completion of Last U.S. Nuclear Plant   [Sep-20-18 07:48PM  The Wall Street Journal]
▶ Opponents to appeal Atlantic Coast Pipeline construction   [02:43PM  American City Business Journals]
▶ 52-Week Company Lows   [Sep-19-18 07:30PM  GuruFocus.com]
▶ Construction resumes for Duke Energy-backed Atlantic Coast Pipeline   [Sep-17-18 06:33PM  American City Business Journals]
▶ Southern Company CEO on hurricane prep and recovery   [Sep-14-18 08:05AM  CNBC Videos]
▶ 52-Week Company Lows   [Sep-13-18 11:56AM  GuruFocus.com]
▶ Georgia Power prepared for Hurricane Florence   [Sep-12-18 05:30PM  PR Newswire]
▶ Virginia Natural Gas Prepares for Hurricane Florence   [Sep-11-18 02:01PM  PR Newswire]
▶ Asian stocks mixed as comment period for US tariffs ends   [Sep-05-18 11:30PM  Associated Press]
▶ Stocks That Fell to 3-Year Lows in the Week of Aug. 31   [Sep-02-18 12:09PM  GuruFocus.com]
▶ Georgia Power ups cost estimate of Plant Vogtle by $1.1B   [Aug-20-18 02:35PM  American City Business Journals]
▶ New Southern Company Gas CEO creates positions for a pair of executives   [10:14AM  American City Business Journals]
▶ Bears Rip U.S. Stocks On China And Turkey News   [Aug-15-18 12:07PM  Investor's Business Daily]
▶ Coal's Future Still Dark   [07:00AM  Morningstar]

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