Mizuho on Friday moved Southern Co. (NYSE: SO) from a Neutral rating to Outperform and lifted its 12-month price target to $104 from $89. The firm said the change reflects a more favorable view of the company’s growth trajectory and its largely regulated business model.
In a note accompanying the upgrade, Mizuho characterized recent concerns tied to the Georgia Public Service Commission elections as overstated and no longer central to the investment thesis. Instead, the analyst emphasized valuation and structural business strengths, arguing that Southern offers an attractive entry point for investors seeking a fully regulated utility growing at an annual rate of 8% or more.
The firm revised its price-to-earnings premium assumption materially, raising it to 15% from 5%. Mizuho said Southern has historically traded at one of the higher P/E ratios within the utility group and now anticipates the stock moving toward a mid-double digit premium. The shares currently trade at a P/E of 23.22.
Separate analysis indicates the shares are overvalued relative to a Fair Value estimate, placing Southern among stocks flagged on a most-overvalued list. The company, however, still yields 3.11% in dividends and has a long record of shareholder payouts, having increased its dividend for 24 consecutive years.
Mizuho highlighted four attributes it sees as differentiating Southern from peers with similar growth rates: approximately 90% of operations are fully regulated; the business does not rely on a single large customer; it operates in a vertically integrated environment; and it maintains a Baa1 balance sheet rating. Those elements underpin the firm’s view that sustained growth should outweigh political noise in the near term.
The analyst team also reminded investors that the next Georgia Power rate case is scheduled for 2028, a timing detail the firm said reduces immediate regulatory risk. Mizuho updated its price target based on higher earnings estimates, reflecting the adjustment in valuation assumptions rather than new operational disclosures from the company.
On the corporate results front, Southern Company reported fourth-quarter 2025 revenue of $6.98 billion, a figure that topped expectations by 9.06%. Earnings per share for the quarter came in at $0.55, narrowly missing the consensus forecast of $0.57, a 3.51% shortfall. The revenue outperformance was highlighted as the quarter’s primary positive, while the EPS miss was noted as a modest setback.
Collectively, the rating change, valuation reassessment and quarterly figures have attracted attention from market participants and analysts as stakeholders evaluate Southern’s strategic direction. Market reactions and ongoing analyst commentary are continuing as investors digest the interplay between the company’s regulated growth profile and its current valuation metrics.