Market Pulse44Neutral

The Southern CompanyOpportunity Rank #80(SO) Intrinsic Value & DCF Analysis (2026)

Sector: Utilities

Current Price

$93.43

Last updated: Jun 23, 2026

Price vs Intrinsic Value

$93.43
Price
$307.75
Intrinsic Value
Undervalued by 229%MOS: $246.20

Fundamental Score

56/100
Neutral

Weighted across 6 signals

Narrative Score

66/100
Improving

+3 vs previous

Trend Score

44/100
Weak

As of 2026-06-22

The intrinsic value of The Southern Company (SO) is estimated at $307.75 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $93.43, the stock appears undervalued relative to its projected cash flow fundamentals. This estimate assumes a 3.96% long-term growth rate and an 8.50% discount rate (calculated: 6.40%), reflecting expected future free cash flow and cost of capital.

The intrinsic value of The Southern Company (SO) is estimated at $307.75 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $93.43, the stock appears undervalued relative to its projected cash flow fundamentals. This estimate assumes a 3.96% long-term growth rate and an 8.50% discount rate (calculated: 6.40%), reflecting expected future free cash flow and cost of capital.

Valuation Details

$307.75
▲ 229.39% upside
20% margin of safety: $246.20
Years: 10Growth Rate: 3.96%
Want to create your own valuation? Create a free account.

Capital Efficiency

Average Quarterly ROIC
1.88%
Cost of Capital (estimated)11%
Value StatusUnderperforming Capital

The company is earning below its required return. This may indicate inefficient use of capital or excess cash that isn't being reinvested.

Complete historical ROIC is available with
.

Fundamental Details

56/100
NeutralWeighted across 6 signals
DCF Discount
229.4% discount to price
100
FCF Yield
22.2% trailing FCF yield
100
ROIC vs WACC
ROIC 1.9% vs WACC 11.0% (0.2x)
9
Net Debt / FCF
3.2x net debt to FCF
0
Buybacks
Share count growing
30
FCF CAGR (5Y)
10.5% 5Y FCF CAGR
78
Strengths: DCF Discount, FCF Yield. Concerns: ROIC vs WACC, Net Debt / FCF.

Narrative Details

66/100
Improving
+3 vs previous · +1 new driversVs 6-Month Baseline:Below Avg (26th pct)Weighted across 6 recent drivers
Trend: StableConfidence: 93%Updated: 18m ago
Sources: 81 (76 News · 5 Analyst)
Drivers(last 30 days)
63 news sentiment+1.4
11 regulatory scrutiny+0.1
Earnings beat+0.0
Upgrade headlines+0.0
Analyst downgrades-0.0
4 analyst reiterations0.0

Trend Details

44/100
WeakAs of 2026-06-22308 daily bars used
3M Relative Strength vs SPY-14.7%
Distance from 52-Week High-6.3%
6M Relative Strength vs SPY-3.5%
Price vs 21 EMA52 · +0.4%
Price vs 50 EMA50 · +0.0%
21 EMA vs 50 EMA47 · -0.4%
3M RS vs SPY8 · -14.7%
6M RS vs SPY40 · -3.5%
Distance from 52W High87 · -6.3%

Investment Coach

Updating... 12d ago
BUYConfidence: 61%
Thesis
The Southern Company is significantly undervalued with an estimated fair value 229.7% above its current price, supported by constructive fundamentals and a stable narrative score. Despite trailing returns relative to its cost of capital, the company's strong free cash flow yield and growth prospects make it a compelling buy opportunity.
Key Risk
The key risk is the company's returns continuing to lag behind its weighted average cost of capital, which could undermine valuation improvements.
Signals To Watch
  • Monitor whether valuation discount remains above 10%.
  • Track ROIC versus WACC spread for sustained improvement.
  • Follow narrative trend for meaningful shifts in the score direction.
Ask the Coach - Available with
Historical Growth Rates
Free Cash Flow- - -Trend CAGR: 3.96%5 Year CAGR: 11.72%

Free Cash Flow (in millions)

TTM20252024202320222021202020192018201720162015201420132012201120102009200820072006
$23,333$22,539$18,743$16,648$14,225$13,409$14,137$13,336$14,946$13,818$12,204$13,667$11,792$11,560$9,707$10,428$8,077$7,933$7,359$6,940$5,814

How Intrinziq Estimates Fair Value

Intrinziq estimates The Southern Company's intrinsic value using a discounted cash flow (DCF) model based on free cash flow trends and a market-based discount rate. The model projects future cash flows over ten years and discounts them using a market return assumption to estimate fair value.

The Southern CompanyUtilities

The Southern Company operates as an energy utility, primarily involved in the production, transmission, and distribution of electricity. Its operations are segmented into Gas Distribution Operations, Gas Pipeline Investments, Wholesale Gas Services, and Gas Marketing Services. The company also undertakes the development, construction, acquisition, ownership, and management of various power generation assets, including renewable energy ventures, and supplies electricity to the wholesale market. Complementing its power business, it distributes natural gas in Illinois, Georgia, Virginia, and Tennessee, while also offering gas marketing services, wholesale gas services, and managing gas pipeline investments. Its extensive portfolio of generating assets includes 30 hydroelectric, 24 fossil fuel, three nuclear, 13 combined cycle/cogeneration, 45 solar, 15 wind, one fuel cell, and four battery storage facilities. In terms of natural gas infrastructure, the company builds, operates, and maintains 76,289 miles of pipelines and 14 storage facilities with a total capacity of 157 billion cubic feet, delivering natural gas to residential, commercial, and industrial clients. The Southern Company serves approximately 8.7 million electric and gas utility customers in total. Furthermore, it provides digital wireless communications and fiber optics services. The company was founded in 1945 and maintains its corporate headquarters in Atlanta, Georgia.