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Why Southern Company’s Stock Fell 15% in 1H15

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Southern Company’s stock

In 1Q15, Southern Company’s (SO) stock fell 10% mainly due to concerns that the Fed will increase the interest rates. Southern Company’s stock also fell by 6.10% in 2Q15. Many major energy stocks gave up some of their gains towards the end of June 2015. Overall, the stock posted a 15% loss in 1H15.

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Compared to the benchmark

The SPDR Utilities Select Sector Fund (XLU) is a key ETF in the power utility industry. It fell by 6.30% in 1Q15. It also fell by 6.80% in 2Q15. Overall, XLU recorded a 12.60% loss in 1H15.

Southern Company has underperformed XLU in the last three quarters. Due to a positive earnings surprise in 2Q15, Southern Company’s stock rose by about 7%, but most of the gains were erased due to fall in the news to buy AGL Resources (GAS) for about $8 billion.

Peer performance

NextEra Energy (NEE) fell by 2.50% in 1Q15. It fell by another 6.40% in 2Q15. This led to a loss of 8.10% in 1H15. Dominion Resources (D) fell by 8.50% in 1Q15. It fell by another 6.50% in 2Q15. This led to a loss of 13.70% in 1H15. Duke Energy (DUK) fell by 8.60% in 1Q15. It fell by another 8.10% in 2Q15. This led to a loss of 16% in 1H15. PG&E (PCG) fell by 0.50% in 1Q15 and 7.60% in 2Q15. This led to a loss of 8% in 1H15.

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