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what it is
Sempra runs electric and gas utilities in California and Texas, plus a natural gas export business.
how it gets paid
Last year Sempra Energy made $12.4B in revenue. California gas delivery was the main engine at $3.8B, or 31% of sales.
why it's growing
Revenue grew 5.1% last year. The 5.79% beat matters because utilities do not usually hand out surprises with a smile.
what just happened
$1.28 beat the $1.21 estimate, and revenue hit $3.75B.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
95/100 earnings predictability — you can trust these numbers
18.8x trailing p/e — priced about right
6.5% return on capital — nothing to write home about
xvary composite: 62/100 — average
What they do
Sempra runs electric and gas utilities in California and Texas, plus a natural gas export business.
Nearly 40 million consumers sit on Sempra's network. That is a lot of people who cannot switch providers without moving your life. Sempra buys about 3/4 of its power, and power costs are 25% of revenue, so scale matters more than slogans.
How they make money
$12.4B
annual revenue · their business grew +5.1% last year
California electric delivery
$3.2B
+2.0%
California gas delivery
$3.8B
+1.0%
Texas electric delivery
$2.5B
+4.0%
LNG export and infrastructure
$2.1B
+9.0%
Other and eliminations
$0.8B
0.0%
The products that matter
regulated electric and gas delivery
Regulated Utilities
$12.4B revenue · 95 / 100 predictability
it's the entire $12.4B revenue base, built on state-regulated essential service territories where earnings are usually steadier than growth stocks.
the base business
Key numbers
$5.10
fy2026 eps est
$18B
fy2028 rev est
18.8x
trailing p/e
n/a
dividend yield
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 3 — safer than 50% of stocks
- price stability 85 / 100
- long-term debt $29.0B (34% of capital)
- return on equity 10% — $0.10 profit for every $1 investors have put in
B++ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in SRE 3 years ago → it's now worth $12,650.
The index would have given you $14,770.
source: institutional data · total return
What just happened
beat estimates
$1.28 beat the $1.21 estimate, and revenue hit $3.75B.
That is a 5.79% EPS beat. Revenue was $3.75B, so the quarter looked like earnings control more than top-line fireworks.
$3.75B
revenue
$1.28
eps
5.79%
surprise
the number that mattered
The 5.79% beat matters because utilities do not usually hand out surprises with a smile.
-
we think sempra energy will report flat 2025 per-share earnings.although the company reaffirmed its full-year outlook of $4.30-$4.70 a share in the fourth quarter, we suspect the higher end of the bracket was earned. through the first nine months of 2025, the company posted earnings of $3.45 per share, $0.33 ahead of the comparable prior-year level.
-
meanwhile the fourth quarter is typically seasonally higher in profits relative to the third.
-
even so, another flat year for earnings per share is underwhelming.
-
the outcome of the company’s latest regulatory rate case for the california service area fell short of expectations.
-
leadership also cited inflationary pressures and a higher cost of capital as ongoing headwinds.
source: company earnings report, 2026
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What could go wrong
the #1 risk is california rate-case pressure on allowed returns.
high
california utility rate cases stay weaker than expected
the latest outcome for the california service area fell short of expectations. for a regulated utility, allowed returns are the business model.
when a $12.4B revenue utility earns 10% on equity, even modestly weaker rulings can show up quickly in earnings
high
port arthur LNG and other project approvals take longer
major growth projects still depend on state and federal approvals before they become earnings, not just investor presentations.
a delay does not break the utility base, but it does weaken the case for the $99 target and pushes growth further out
med
higher rates make a capital-intensive business less forgiving
leadership cited inflationary pressure and a higher cost of capital. that is not abstract when the balance sheet carries $29.0B in long-term debt.
financing costs rising faster than allowed returns would pressure the spread that supports earnings growth
med
another flat earnings year makes the valuation look full
full-year EPS was $4.65, unchanged from last year, even as quarterly revenue moved higher. investors are now looking for $5.10 in 2026.
paying 18.8x trailing earnings works only if the next step is growth, not another stall
flat $4.65 EPS, $29.0B in debt, and a $99 target only 13% above today's price leave less room for another regulatory miss than the headline upside suggests.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
fy2026 EPS versus the $5.10 expectation
that's the number that decides whether 18.8x trailing earnings was fair or too generous.
risk
california rate-case follow-through
the latest outcome already disappointed. you want evidence the next round does not keep squeezing allowed returns.
calendar
the next earnings print
watch whether quarterly EPS moves meaningfully above $0.12 and revenue holds above the recent $2.8B run-rate.
trend
institutional buying staying positive
532 buyers versus 464 sellers in 3q2025 is supportive. you want that trend to continue if the growth story is real.
Analyst rankings
short-term outlook
average
momentum score 3 — in human-speak, analysts see a normal near-term setup, not a strong directional signal.
risk profile
average
stability score 3 — this sits in the middle of the pack on risk. safer than many stocks, but not unusually defensive.
chart momentum
top 20%
technical score 2 — the tape looks better than the fundamentals. that can help you in the short run, but it does not fix a weak rate case.
earnings predictability
95 / 100
management's numbers are usually dependable. the issue here is not chaos — it's whether predictable growth will be good enough.
source: institutional data
Institutional activity
institutions have been net buying for 2 consecutive quarters — 532 buyers vs. 464 sellers in 3q2025. total institutional holdings: 0.6B shares. net buying for 2 quarters.
source: institutional data
Price targets
3-5 year target range
$68
$130
$88
current price
$99
target midpoint · +13% from current · 3-5yr high: $135 (+55% · 14% ann'l return)
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