Electric utility firm Southern Company SO is set to release its first-quarter 2016 results before the opening bell on Wednesday, Apr 27. In the preceding three-month period, the Atlanta-based service provider delivered a positive earnings surprise of 4.76% on lower costs. As far as the earnings surprise history is concerned, the company has a good record: its beaten estimates in 3 of the last four quarters with an average beat of 1.69%. Let’s see how things are shaping up for this announcement. Factors to Consider This Quarter The operating results of Southern Company are affected by weather conditions and may vary on a seasonal and quarterly basis. Electric power supply is usually a seasonal business. In several regions of the country, demand for power peaks during the summer months, along with market prices. In other areas, power demand reaches its maximum during the winter. But with this year’s winter being warmer-than-usual, Southern Company’s first quarter retail electricity demand might suffer. However, a leading utility holding entity in the U.S., Southern Company dominates the power business across the Southeast. With a strong rate base growth and constructive regulation, we expect the firm to generate steady earnings. Also, with operations in a stable and growing industry, Southern Company has a steady stream of cash flow. The utility’s history of consistent dividend payments indicates its confidence in itself. We further appreciate Southern Company’s cost reduction initiatives as seen in the previous quarter when its total operating expenses decreased around 12% year over year. Earnings Whispers Our proven model does not conclusively show that Southern Company will beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to be able to beat consensus estimates. That is not the case here as you will see below. Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is 0.00%. This is because the Most Accurate estimate and the Zacks Consensus Estimate both stand at 53 cents. Zacks Rank: Southern Company has a Zacks Rank #3. Though a Zacks Rank #3 increases the predictive power of ESP, the company’s ESP of 0.00% makes surprise prediction difficult. We caution against Sell-rated stocks (Zacks Ranks #4 and 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions. Stocks to Consider While earnings beat looks uncertain for Southern Company, here are some utilities you may want to consider on the basis of our model, which shows that they have the right combination of elements to post an earnings beat this quarter: TELUS Corp. TU has an Earnings ESP of +10.00% and a Zacks Rank #2. The company is expected to release earnings results on May 5. BCE Inc. BCE has an Earnings ESP of +1.54% and a Zacks Rank #2. The company is anticipated to release earnings on Apr 28. Consolidated Edison Inc. ED has an Earnings ESP of +0.82% and a Zacks Rank #3. The company is likely to release earnings on May 5. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SOUTHERN CO (SO): Free Stock Analysis Report CONSOL EDISON (ED): Free Stock Analysis Report TELUS CORP (TU): Free Stock Analysis Report BCE INC (BCE): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research