Stock Analysis | The Southern Outlook - A Weak Technical Signal Amid Mixed Analyst Opinions

Market Snapshot

Takeaway: The Southern (SO) is currently experiencing a weak technical outlook and is suggested to be avoided, with a technical score of 3.48 (internal diagnostic score, 0-10).

News Highlights

Recent headlines include developments in clean energy and electric vehicle (EV) initiatives. For instance, Damen Shipyards Group has chosen Corvus Energy to supply energy storage systems for four new, fully electric-capable ferries for BC Ferries. These vessels are expected to expand the ferry operator's electric fleet by 2027. Another significant update is the U.S. government’s consideration of a levy on gasoline-powered cars to promote the adoption of EVs, with the potential to establish an “EV Fund” to support this shift.

These developments may indirectly influence SO as part of the broader electric power and utility industry. The Zacks Utility – Electric Power industry is increasingly shifting toward clean fuel sources and prioritizing the reduction of carbon emissions, supported by government initiatives that facilitate this transformation.

Analyst Views & Fundamentals

Analysts have provided a mixed outlook on SO. The simple average rating is 3.60, while the performance-weighted rating is 2.51. This suggests a relatively neutral to bearish sentiment. However, there is significant dispersion in the ratings, with five active institutions showing differing views. For example, Barclays and JP Morgan have a good historical win rate (100.0%) and a neutral stance, while Scotiabank has a poor historical win rate (33.3%) but a strong buy recommendation.

From a fundamental perspective, here are the key factors and their scores (internal diagnostic scores, 0-10):

• Basic earnings per share (YoY growth rate %): -5.63%, score: 2
• Non-current assets / Total assets (%): 92.74%, score: 2
• Cash-UP: 0.66, score: 2
• Rate of return on total assets (%): 2.91%, score: 3
• Long-term debt to working capital ratio (%): 7.49%, score: 1
• Annualized return on total assets (%): 5.82%, score: 3
• Total assets turnover ratio: 0.10, score: 1
• Cost of sales ratio (%): 29.96%, score: 0
• Current assets / Total assets (%): 7.26%, score: 3

These values and scores indicate a weak fundamental outlook for SO.

Money-Flow Trends

Money-flow data shows an overall negative trend for SO. The large-inflow ratio is at 50.73%, suggesting that big institutional investors are not aggressively buying in. Meanwhile, the small-inflow ratio is at 49.77%, indicating that retail investors are also showing caution. The block-inflow ratio, at 48.12%, further reinforces this sentiment. The negative trend is evident across all investor categories, with only large investors showing a positive trend.

Key Technical Signals

SO's technical indicators are currently skewed to the bearish side, with 3 bearish signals and 0 bullish ones. Key signals to watch include:

• MACD Death Cross: Score of 2.28 (internal diagnostic score, 0-10). This is a neutral-biased signal but still indicates weakness.
• Earnings Release Date: Score of 1 (internal diagnostic score, 0-10). This indicator is historically weak, with a win rate of 25.0% and an average return of -0.49%.
• WR Overbought: Score of 1 (internal diagnostic score, 0-10). This is a bearish signal, with a win rate of 35.59% and a historical average return of -0.85%.

Recent chart patterns include:

• On 2025-07-22: WR Overbought, RSI Overbought
• On 2025-07-25: Bullish Engulfing, Marubozu White
• On 2025-08-04: WR Overbought

These patterns indicate a volatile market with unclear direction. The bearish signals are clearly dominant, with 3 bearish indicators versus 0 bullish ones.

Conclusion

Given the weak technical score and the recent bearish signals, investors are advised to consider avoiding SO at this time. The fundamental indicators also suggest a cautious approach. While some analyst ratings are optimistic, the overall dispersion in sentiment and the weak internal model scores reinforce the recommendation to wait for a clearer trend or a more favorable entry point.