Aureus
FRed Flag

Southern Company (The)(SO)

F

Financial data as of Dec 31, 2025Declining · Utilities

FCF Margin-9.9%Free Cash Flow / Revenue
Cash Conversion225.8%Operating CF / Net Income
Free Cash Flow-$2.9B
Revenue$29.6B
Net Cash-$72.4BNet debt position
Debt / FCFN/AElevated debt burden
Current Ratio0.65Tight short-term liquidity
YoY FCF Growth-193.1%1 of 5 quarters positive

How This Grade Was Calculated

Base grade from FCF margin, adjusted by financial health factors

BaseF
→
-1Current ratio below 1.0 (0.65)
→
-1Negative FCF in 3 of last 4 quarters
→
-1Significant YoY FCF decline (-193.1%)
→
-1Only 1 positive quarters recently
→
-0.5Highly volatile FCF (consistency: 1.07)
→
FinalF

Analysis Summary

Strengths

  • Excellent cash conversion (226%)

Concerns

  • Negative FCF margin (-9.9%)
  • Net debt position ($72.4B)
  • Current ratio below 1.0 — tight short-term liquidity
  • Only 1 positive FCF quarters recently
  • Significant YoY FCF decline (-193.1%)
  • Highly volatile quarterly FCF
Heavy CapEx — Operating cash flow is strong (33% margin) but most is reinvested

Financial Breakdown

Key financials compared side by side

Margin Composition

FCF Margin-9.9%
Net Margin14.7%
Operating CF Margin33.2%
CapEx Ratio43.1%

Balance Sheet Health

Debt, liquidity, and leverage snapshot

Net Cash-$72.4BNet debt position
Debt / FCFN/AElevated debt burden
Current Ratio0.65Tight liquidity
Debt / Equity2.06High leverage

Quarterly FCF Trend

-193.1% YoYDeclining (-193.1%)

Free cash flow per quarter

Sector Comparison — Utilities

FCF Margin ranked against sector peers

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Detailed Metrics

Company NameSouthern Company (The)
SectorUtilities
Free Cash Flow-$2.9B
Revenue$29.6B
Net Income$4.3B
Operating Cash Flow$9.8B
Capital Expenditure$12.7B
FCF Margin-9.9%
Cash Conversion Rate225.8%
Net Margin14.7%
Total Debt$74.1B
Total Cash$1.6B
Net Cash-$72.4B
Current Ratio0.65
Debt / Equity2.06
Debt / FCFN/A
YoY FCF Growth-193.1%
Positive Quarters1 of 5
Trend DirectionDeclining
Report DateDec 31, 2025
GradeF
Data SourceYahoo Finance

Related Research

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Sector Report5 min read

Utilities: An Entire Sector Failing Cash Flow

Every single utility we analyzed earned an F. The median FCF margin is negative. This isn't a sector, it's a capital incinerator.

Feb 13, 2026
WECSODUKEIX+6