SO - Southern Co. joins Goldman Sachs' U.S. Conviction List

2023-07-03 13:30:30 ET

Southern Co. ( NYSE: SO ) was added by Goldman Sachs on Monday to its new Conviction List of top Buy-rated U.S. stocks, viewing the company as "uniquely positioned to provide above average clean energy growth (nuclear) while having below average regulatory risk within its regulated utility."

Investors may not see nuclear as related to energy growth, but Goldman's Carly Davenport said the passage of the Inflation Reduction Act last year, which included a nuclear production tax credit, helps de-risk the asset class and makes it a growth enabler for Southern ( SO ).

Davenport said she believes the company has turned a corner with the start-up on Vogtle Units 3 and 4 as positive catalysts for Southern ( SO ) stocks, which she rates as a Buy with an $80 price target.

Southern's ( SO ) largest utility, Georgia Power, also reached a constructive settlement agreement with the Georgia PSC in December on a multi-year electric base rate increase covering 2023-25, which Davenport said de-risks the company from near-term rate case risk compared to other regulated utilities where uncertainty is much greater.

More on Southern Co.:

• Financial and valuation comparison to sector peers
• Analysis: Even With End Of The Vogtle Saga, Southern Co. Is A Hold
• Stock price return: Down 2% YTD, down less than 1% in the past 12 months

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