Location, location, location. In addition to reportedly being the key driver of real estate value and price escalation, it appears that this repetitive chant also matters a great deal to the financial health of a utility company. That, at least, would seem to be a reasonable takeaway from Southern Company's (NYSE:SO) report for its first quarter, released late last week.

For the quarter, the company, which has its headquarters in economically vibrant Atlanta and provides electricity to customers in much of the Southeast, earned $339 million, or $0.45 a share, compared with $262 million, or $0.35 a share, in the comparable quarter last year. This 29% earnings improvement was achieved on an 11.3% increase in revenue to $3.41 billion, from $3.06 billion in 2006. The higher percentage of earnings growth resulted from lower-percentage increases in expense lines such as non-fuel operating and maintenance charges, depreciation and amortization, and non-income taxes.

Southern Company's 4.3 million customers are served by well-known public utility names such as Alabama Power, Georgia Power, Gulf Power, and Mississippi Power. Last year, Savannah Power was merged into Georgia Power. During the past year, in large part because of its location, Southern Company has added 70,000 customers in the four states it services. This is an area where kilowatt-hour sales, including wholesale sales, grew 6.7% year over year in the quarter.

The share price of Southern Company, which carries an A- credit rating from S&P, an A3 from Moody's, and an A from Fitch, has improved 18% during the past year. It generally is comparable to one degree or another to other U.S. power providers such as Duke Energy (NYSE:DUK), Allegheny Energy (NYSE:AYE), and Exelon (NYSE:EXC). These are all solid companies, with stable earnings bases.

So if, like me, you feel somewhat queasy about our economy going forward -- as a result of concerns about both a housing spillover and a refusal to be inappropriately cavalier about our ability to withstand higher energy costs over time -- you're probably well advised to look closely at a company with nearly 20% price appreciation and a stellar credit rating. If you'll pardon my saying so, it seems to me that this is one thoroughgoing Georgia peach.

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Fool contributor David Lee Smith does not own shares in any of the companies mentioned. He welcomes your questions or comments. The Fool has a disclosure policy.