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Southern Company (The) (SO) vs UnitedHealth Group Incorporated (UNH): Which Is the Better Buy in 2026?

As of 2026-08-03, SO is overvalued at $95, with a DCF intrinsic value of $15 and a margin of safety of -526%. UNH is overvalued at $414, with an intrinsic value of $371 and a margin of safety of -12%. Of the two, UNH has the wider margin of safety.

SO
Southern Company (The)
$94.54
VS
UNH
UnitedHealth Group Incorporated
$414.40

Rewards

SO
  • ★Each dollar of retained earnings has created $2.41 of earning power — management is an exceptional capital allocator.
UNH
  • ★UnitedHealth Group Incorporated scores 73/100 on the Economic Moat Score (Wide Moat), with revenue predictability as the strongest competitive dimension.

Risks

SO
  • ⚠Southern Company (The) scores only 26/100 on the Economic Moat Score, suggesting limited durable competitive advantages.
  • ⚠PEG ratio of 2.41 indicates the stock is expensive relative to its expected growth — the market may be pricing in more growth than analysts project.
  • ⚠High leverage (1.75x net debt/equity) combined with thin interest coverage (-1.0x) poses financial risk.
UNH
  • ⚠ROIC has declined by 6.9 percentage points over the past 4 years, which may signal competitive erosion.
  • ⚠Gross margin of 19.5% is low, suggesting a competitive or commodity-like market with limited pricing power.
  • ⚠FCF yield of 6.0% suggests reasonable valuation assuming continued moderate growth.

Key Valuation Metrics

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SO
UNH
Valuation
$-3.91B
Free Cash Flow
$22.76B
-3.60%
FCF Yield
6.05%
22.78
Trailing P/E
31.25
19.22
Forward P/E
18.47
Quality & Moat
5.91%
ROIC
14.15%
11.48%
ROE
14.15%
48.29%
Gross Margin
19.51%
2.41
PEG Ratio
1.28
Balance Sheet Safety
1.75
Net Debt / Equity
0.40
N/A
Interest Coverage
N/A
5.20
Net Debt / EBITDA
1.73
3.22%
Dividend Yield
2.24%
SO: 3Ties: 2UNH: 7
SOUNH

Historical Fundamentals

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SO

Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.

UNH

Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.

Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.

$1 Retained Earnings Test

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SO
$5.15
created per $1 retained over 3 years
Exceptional Value Creator
Σ Retained
$3.71B
Δ Market Cap
+$19.12B
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
UNH
$-7.37
created per $1 retained over 3 years
Market Cap Declined
Σ Retained
$26.63B
Δ Market Cap
$-196.16B
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer

Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer

Discounted Cash Flow (DCF) Analysis

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SO
526.4% Overvalued
Price is 526.4% above estimated fair value
Current Price: $94.54
Fair Value: $15.09
Strongly undervalued
Undervalued
Fairly valued
Overvalued
Strongly overvalued
UNH
11.7% Overvalued
Price is 11.7% above estimated fair value
Current Price: $414.40
Fair Value: $370.88
Strongly undervalued
Undervalued
Fairly valued
Overvalued
Strongly overvalued

Reverse DCF — Market-Implied Growth

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SO

Requires positive FCF to compute implied growth rate.

UNH

What growth rate is the market pricing in at $414?

+14.4%
Market-Implied Owner Earnings Growth
Standard FCF implies +6.6%

The market implies +14.4% Owner Earnings growth, above historical trends.

Standard FCF implies a demanding +6.6%, reflecting heavy growth investment.

Economic Moat Score

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SO
26/100
No Moat
70+ Wide · 40-69 Narrow · <40 None

No durable moat detected, though margin stability shows some competitive positioning. The business lacks consistent evidence of sustainable advantages.

Composite score measuring competitive advantage durability across four dimensions: returns above cost of capital, pricing power stability, revenue predictability, and capital efficiency. Based on 5 years of fundamental data.
UNH
73/100
Wide Moat
70+ Wide · 40-69 Narrow · <40 None

Wide moat driven primarily by revenue predictability. Margin Stability is the area most vulnerable to competitive pressure.

Composite score measuring competitive advantage durability across four dimensions: returns above cost of capital, pricing power stability, revenue predictability, and capital efficiency. Based on 4 years of fundamental data.

Forensic Accounting

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SO
-2.65
Unlikely Manipulator
Above -1.78 = likely manipulator · -2.22 to -1.78 = grey zone

M-Score Trend

Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
UNH
-2.45
Unlikely Manipulator
Above -1.78 = likely manipulator · -2.22 to -1.78 = grey zone

M-Score Trend

Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.

Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.

Ownership Breakdown

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SO
Insiders 0.1%Institutions 71.1%Retail & Other 28.8%
No. of Institutional Holders2,839
High insider ownership aligns management incentives with shareholders — a key signal in Buffett-style analysis. Institutional concentration can indicate smart-money conviction but also crowding risk.
UNH
Insiders 0.2%Institutions 86.1%Retail & Other 13.6%
No. of Institutional Holders4,164
High insider ownership aligns management incentives with shareholders — a key signal in Buffett-style analysis. Institutional concentration can indicate smart-money conviction but also crowding risk.

High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.

Insider Buying Activity

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SO
0
Buys (3M)
0
Buys (12M)
No open market insider purchases found.
Open market purchases · includes direct & indirect ownership · excludes option exercises
UNH
0
Buys (3M)
0
Buys (12M)
REX JOHN F
President
$5.00M
@ $291.12 · 2025-05-16
HEMSLEY STEPHEN J
Chief Executive Officer
$25.02M
@ $288.57 · 2025-05-16
GIL KRISTEN
Director
$1.00M
@ $271.17 · 2025-05-15
FLYNN TIMOTHY PATRICK
Director
$491,786
@ $320.80 · 2025-05-14
NOSEWORTHY JOHN H
Director
$93,647
@ $312.16 · 2025-05-14
Open market purchases · includes direct & indirect ownership · excludes option exercises

Open market purchases · includes direct & indirect ownership · excludes option exercises.

Insider Selling Activity

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SO
2
Sells (3M)
9
Sells (12M)
Total value (12M): $5.60M
KIM MATTHEW M.
Officer
$9,577
@ $95.77 · 2026-07-01
KIM MATTHEW M.
Officer
$9,116
@ $91.16 · 2026-06-01
KIM MATTHEW M.
Officer
$9,657
@ $96.57 · 2026-05-01
GREENE KIMBERLY S
Officer
$2.42M
@ $96.67 · 2026-03-30
CUMMISKEY CHRISTOPHER
Officer
$643,892
@ $96.55 · 2026-03-19
CONNALLY STANLEY W JR
Chief Operating Officer
$1.21M
@ $97.13 · 2026-03-18
KIM MATTHEW M.
Officer
$487,453
@ $95.15 · 2026-02-24
ANDERSON BRYAN D
Officer
$582,309
@ $93.83 · 2025-09-30
SPAINHOUR STERLING A. JR.
Officer
$226,148
@ $95.02 · 2025-08-11
GREENE KIMBERLY S
Officer
$1.25M
@ $95.00 · 2025-07-21
CUMMISKEY CHRISTOPHER
Officer
$1.10M
@ $89.54 · 2025-05-23
CONNALLY STANLEY W JR
Chief Operating Officer
$1.15M
@ $92.24 · 2025-03-31
GREENE KIMBERLY S
Chief Executive Officer
$3.00M
@ $93.12 · 2025-03-10
DAVIS MARTIN BERNARD
Chief Technology Officer
$100,811
@ $89.61 · 2025-03-03
WOMACK CHRISTOPHER C.
Chief Executive Officer
$2.20M
@ $90.13 · 2025-03-03
WOMACK CHRISTOPHER C.
Chief Executive Officer
$143,370
@ $90.00 · 2025-02-25
CUMMISKEY CHRISTOPHER
Officer
$81,184
@ $86.00 · 2025-02-19
PEOPLES JAMES JEFFREY
Chief Executive Officer
$1.25M
@ $86.00 · 2025-02-11
CUMMISKEY CHRISTOPHER
Officer
$69,739
@ $83.32 · 2025-02-04
DAVIS MARTIN BERNARD
Chief Technology Officer
$100,503
@ $85.90 · 2024-12-05
WOMACK CHRISTOPHER C.
Chief Executive Officer
$1.21M
@ $86.18 · 2024-12-05
SPAINHOUR STERLING A. JR.
Officer
$70,212
@ $88.54 · 2024-11-04
KERR JAMES Y. II
Chief Executive Officer
$2.69M
@ $89.64 · 2024-10-04
ANDERSON BRYAN D
Officer
$587,830
@ $89.54 · 2024-09-06
SPAINHOUR STERLING A. JR.
Officer
$211,796
@ $88.99 · 2024-08-05
Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives
UNH
0
Sells (3M)
1
Sells (12M)
Total value (12M): $284,000
CONWAY PATRICK HUGH
Officer
$284,000
@ $355.00 · 2026-04-23
CONWAY PATRICK HUGH
Chief Executive Officer
$179,645
@ $305.00 · 2025-06-10
Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives

Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.

🎭 Mr. Market's Mood

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SO
FearGreed
😐Neutral(57/100)

"Market is pricing this stock without strong emotion in either direction"

Composite sentiment score based on 6 market signals. Inspired by Buffett's "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
UNH
FearGreed
😐Neutral(57/100)

"Market is pricing this stock without strong emotion in either direction"

Composite sentiment score based on 6 market signals. Inspired by Buffett's "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.

Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.

⚖️ Buffett Signal

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SO
⚪Awaiting DCF Data

The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.

DCF Margin of Safety: N/AMr. Market's Mood: Neutral (57)
UNH
⚪Awaiting DCF Data

The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.

DCF Margin of Safety: N/AMr. Market's Mood: Neutral (57)
View SO Full AnalysisView UNH Full Analysis

Frequently Asked Questions: SO vs UNH

Is Southern Company (The) or UnitedHealth Group Incorporated more undervalued in 2026?▼

Based on our discounted cash flow model, UNH trades at a -11.7% margin of safety (intrinsic value $371 vs. price $414), compared to SO's -526.4% margin of safety (intrinsic $15 vs. $95).

Which stock has a wider economic moat, Southern Company (The) or UnitedHealth Group Incorporated?▼

UNH scores 73/100 (Wide moat), while SO scores 26/100 (None moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.

Is Southern Company (The) in financial distress?▼

SO's Altman Z-Score of 0.9 places it in the Distress zone, signaling elevated bankruptcy risk. UNH scores 2.9 (Grey zone). The Altman Z-Score is a five-factor model that predicts insolvency within two years; scores below 1.81 indicate significant distress.

Which company has better free cash flow, Southern Company (The) or UnitedHealth Group Incorporated?▼

UnitedHealth Group Incorporated (UNH) generates a 6.0% free cash flow yield, compared to Southern Company (The)'s -3.6%. A higher FCF yield means the business converts more of its market value into cash that can be returned to shareholders or reinvested.

Which stock has higher return on invested capital, Southern Company (The) or UnitedHealth Group Incorporated?▼

UNH earns 14.1% ROIC versus SO's 5.9%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.

Which dividend is safer, Southern Company (The)'s or UnitedHealth Group Incorporated's?▼

UNH's dividend earns a safety score of 84/100 (Very Safe), compared to SO's 63/100 (Safe). UNH has raised its dividend for 3 consecutive years.