UPDATE: Bank of America Downgrades Southern Company to Neutral, Valuation Full

Bank of America lowers its rating on Southern Company

from Buy to Neutral, but raises its price target from $47 to $48. Bank of America comments, "We are downgrading SO to Neutral from Buy. SO is trading at an 11% premium to the regulated group. While we continue to like SO's high-quality, low-risk profile, we see this reflected in the premium stock valuation. SO is currently trading at an 18x forward P/E, one of the highest in the S&P 500. We believe the current flight to defensive stocks has benefitted utility stocks, but valuations look increasingly stretched, particularly for large cap names like SO." SO closed at $47.70 on Tuesday.