Sempra Energy (SRE) AI Stock Analysis

• Market Cap: $48.31B
• Dividend Yield: 3.48%
• Average Volume (3M): 3.57M
• Price to Earnings (P/E): 16.3
• Beta (1Y): 0.63
• Revenue Growth: -0.39%
• EPS Growth: 0.75%
• Country: US
• Employees: 16,773
• Sector: Utilities
• Sector Strength: 77
• Industry: Diversified Utilities
• EPS (TTM): 1.44
• Shares Outstanding: 652,170,400
• 10 Day Avg. Volume: 3,498,151
• 30 Day Avg. Volume: 3,569,454
• PEG Ratio: -2.53
• Price to Book (P/B): 2.19
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -16.81
• Enterprise Value/Market Cap: 1.40
• Enterprise Value/Revenue: 1.28
• Enterprise Value/Gross Profit: 12.05
• Enterprise Value/Ebitda: 3.01
• 1Y Price Target: $81.20
• Price Target Upside: 10.06% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 10

• Rating: 72 Outperform
• Price Target: $84.00 ▲(13.85%Upside)

Sempra Energy's overall stock score reflects strong financial performance with robust profitability and strategic initiatives driving EPS growth. However, high leverage, cash flow challenges, and regulatory hurdles present risks. Recent corporate events and fair valuation provide additional support.

Positive Factors

Financial Performance

Sempra Energy's 1Q25 EPS of $1.44 beat consensus estimates, indicating stronger than expected financial performance.

Growth Outlook

The company's growth outlook into 2029 is expected to be at or above the high end of the projected 7-9% EPS CAGR range, showcasing strong future growth potential.

Strategic Direction

Analyst maintains a Buy rating, indicating confidence in SRE's strategic direction.

Negative Factors

Credit Concerns

Credit concerns remain following Moody's outlook downgrade to Negative.

Interest Rate Impact

Earnings outlook remains challenging, with higher corporate interest rate assumption leading to marginally lower estimates.

Regulatory Challenges

Regulatory reservations and rate case concerns hang over reduced guidance.

Sempra Energy Business Overview & Revenue Model

Company Description

Sempra operates as an energy-services holding company in the United States and internationally. The company's San Diego Gas & Electric Company segment provides electric services; and supplies natural gas. It offers electric services to approximately 3.6 million population and natural gas services to approximately 3.3 million population that covers 4,100 square miles. Its Southern California Gas Company segment owns and operates a natural gas distribution, transmission, and storage system that supplies natural gas to a population of approximately 22 million covering an area of 24,000 square miles. The company's Sempra Texas Utilities segment engages in the regulated transmission and distribution of electricity serving 3.8 million homes and businesses, and operation of 140,000 miles of transmission and distribution lines. Its transmission system includes 18,249 circuit miles of transmission lines, a total of 1,174 transmission and distribution substations, and interconnection to 130 third-party generation facilities totaling 45,403 megawatts. The company was formerly known as Sempra Energy and changed its name to Sempra in July 2021. Sempra was founded in 1998 and is headquartered in San Diego, California.

How the Company Makes Money

Sempra Energy generates revenue primarily through its regulated utilities and energy infrastructure businesses. The company's regulated utilities, which include Southern California Gas Company and San Diego Gas & Electric, provide electric and natural gas services, earning revenues through regulated rates set by state commissions. Additionally, Sempra Infrastructure focuses on developing and operating energy infrastructure projects, including natural gas pipelines, storage facilities, and liquefied natural gas (LNG) export terminals. Revenues from these operations come from long-term contracts and user fees for the infrastructure services provided. Sempra Energy's earnings are significantly influenced by regulatory decisions, energy market conditions, and its ability to secure long-term contracts with reliable counterparties.

Sempra Energy Financial Statement Overview

Summary

Sempra Energy shows robust profitability and efficient equity utilization, key strengths in its financial performance. However, challenges with high leverage and negative free cash flow, alongside modest revenue growth, indicate areas needing improvement.

Income Statement

Sempra Energy exhibits solid profitability metrics with a gross profit margin of 42.1% and a net profit margin of 22.2% on a TTM basis. The revenue growth rate is modest at 1.23% from the previous year, which is steady but not particularly high. The EBIT margin stands at 22.7%, showing efficient operational management. Overall, the company demonstrates consistent profitability, although growth rates are moderate.

Balance Sheet

The company maintains a high debt-to-equity ratio of 1.19, indicating significant leverage which is common in the utilities industry. However, the return on equity is impressive at 9.4%, showcasing efficient use of equity to generate profits. The equity ratio of 31.9% reflects a balanced approach to asset financing, but there is room for improvement in reducing leverage.

Cash Flow

Sempra Energy faces challenges in cash flow management with negative free cash flow growth at -23.3%. The operating cash flow to net income ratio is 1.53, indicating strong cash generation relative to net income, although free cash flow remains negative. The free cash flow to net income ratio is -1.38, highlighting the need for improved capital expenditure management.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
11.69B	13.19B	16.72B	14.44B	12.86B	11.37B
	Gross Profit
4.42B	6.09B	5.94B	5.21B	3.44B	5.04B
	EBIT
2.39B	2.96B	5.84B	3.53B	2.98B	2.88B
	EBITDA
3.52B	5.60B	6.12B	4.42B	3.26B	4.23B
	Net Income Common Stockholders
1.05B	2.86B	3.08B	2.14B	1.32B	3.93B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
78.00M	1.56B	236.00M	370.00M	559.00M	960.00M
	Total Assets
61.62B	96.16B	87.18B	78.57B	72.05B	66.62B
	Total Debt
24.41B	35.85B	31.75B	28.92B	24.64B	24.21B
	Net Debt
24.34B	34.28B	31.46B	28.55B	24.09B	23.25B
	Total Liabilities
42.15B	58.37B	53.53B	49.32B	44.63B	41.69B
	Stockholders Equity
17.37B	25.36B	28.70B	27.14B	26.00B	23.39B
Cash Flow		Free Cash Flow
-255.00M	-3.31B	-2.18B	-4.21B	-1.17B	-2.08B
	Operating Cash Flow
4.46B	4.91B	6.22B	1.14B	3.84B	2.59B
	Investing Cash Flow
-23.27B	-9.12B	-8.72B	-5.04B	-5.51B	553.00M
	Financing Cash Flow
8.85B	5.42B	2.42B	3.78B	1.26B	-2.37B

Sempra Energy Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 73.78
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SRE, the sentiment is Negative. The current price of 73.78 is below the 20-day moving average (MA) of 76.83, below the 50-day MA of 74.26, and below the 200-day MA of 79.74, indicating a bearish trend. The MACD of -0.11 indicates Positive momentum. The RSI at 40.75 is Neutral, neither overbought nor oversold. The STOCH value of 21.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SRE.

Sempra Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CIG	80 Outperform	$6.27B	4.30	26.38%	73.34%	-4.14%	13.02%
ELP	78 Outperform	$6.47B	12.68	9.22%	3.48%	-7.02%	17.33%
SRE	72 Outperform	$48.31B	16.30	9.76%	3.48%	-0.39%	0.75%
BKH	68 Neutral	$4.12B	14.51	8.02%	4.76%	3.28%	-3.49%
Sector *	64 Neutral	$8.57B	10.35	4.24%	4.64%	4.07%	-13.04%
BIP	64 Neutral	$21.48B	2,867.59	0.47%	5.22%	12.40%	-108.27%
AES	54 Neutral	$8.14B	6.25	29.79%	6.15%	-3.22%	141.11%

Sempra Energy Corporate Events

Sempra Energy Subsidiary Completes $1.1 Billion Bond Offering

On May 16, 2025, Southern California Gas Company, an indirect subsidiary of Sempra, completed a public offering of $600 million in 5.450% First Mortgage Bonds due 2035 and $500 million in 6.000% First Mortgage Bonds due 2055. The proceeds from these offerings will support the company’s financial activities, potentially strengthening its market position and providing benefits to stakeholders.

The most recent analyst rating on (SRE) stock is a Buy with a $85.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.

Sempra Energy Shareholders Approve Key Proposals

On May 13, 2025, Sempra held its Annual Shareholders Meeting where shareholders elected all eleven director nominees, ratified Deloitte & Touche LLP as the independent public accounting firm for 2025, and approved the company’s executive compensation. These decisions reflect strong shareholder support for the company’s leadership and strategic direction, potentially reinforcing Sempra’s position in the energy sector and influencing its future operations.

The most recent analyst rating on (SRE) stock is a Buy with a $85.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.

Sempra Energy Subsidiary Issues $1.1 Billion Bonds

On May 12, 2025, Southern California Gas Company, a subsidiary of Sempra, entered into an underwriting agreement to issue $1.1 billion in First Mortgage Bonds. This strategic move aims to strengthen the company’s financial position and enhance its market offerings, potentially impacting stakeholders positively by ensuring long-term financial stability.

The most recent analyst rating on (SRE) stock is a Buy with a $85.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.