Southern Company’s dividends
Southern Company (SO) paid ~$1.63 per share in dividends to shareholders in the first three quarters of 2015. For 2015, the company plans to give a total of $2.17 per share to shareholders in the form of dividends, implying another $0.54 per share in dividends in 4Q15.
Southern Company gives a stable dividend to its investors
Southern Company (SO) has a dividend yield of 4.71% as of October 28, 2015. The company’s management has been raising the dividend on a consistent basis for the last six years. It has increased at an average annual rate of 3.7%.
Southern Company is one of the top five holdings of the Utilities Select Sector SPDR ETF (XLU) and constitutes 7.57% of the fund’s total holdings. Its peers in the utilities sector, NextEra Energy (NEE), Duke Energy (DUK), and Dominion Resources (D) are expected to declare an annual dividend of $3.08, $3.27, and $2.58 per share, respectively, for 2015.
Southern Company’s financing plans for fiscal 2015
During 3Q15, the Southern Company funded its capex through debt issuances of nearly $1.8 billion. Out of this, $400 million was raised by its subsidiary, Southern Power, through capital markets for its existing projects. The remaining debt of $1.4 billion was raised by its holding company through capital markets.
For 4Q15, the Southern Company plans to raise $750 million through capital markets for additional projects that the company identifies. Southern Company is also planning to raise $120 million of common equity in order to fund its capex plan.