The completion of the Vogtle 3 nuclear load is a “major milestone” for Southern Co SO and indicates that the commencement of the Unit is now imminent, according to KeyBanc Capital Markets.
The Analyst: Sophie Karp upgraded the rating for gas and electric utility company Southern from Sector Weight to Overweight, while establishing a price target of $70.
The Thesis: After significant construction challenges over the past decade, the Vogtle Unit 3 completion should come as a relief to investors and “should de-risk outlook,” Karp said in the upgrade note.
“With Vogtle overhangs diminishing, we believe that SO management will be freed up to focus on proactive portfolio management and LT growth targets,” the analyst wrote.
“Specifically, we imagine that the Company will look across its portfolio of LDCs and non-regulated assets for capital recycling opportunities that could help offset some funding needs in the core utility business,” he added.
SO Price Action: Shares of Southern had risen by 0.65% to $65.11 in premarket trading on Thursday.
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