Sempra Energy (SRE) AI Stock Analysis

• Market Cap: $59.92B
• Dividend Yield: 2.91%
• Average Volume (3M): 3.63M
• Price to Earnings (P/E): 31.4
• Beta (1Y): 0.61
• Revenue Growth: 9.07%
• EPS Growth: -28.58%
• Country: US
• Employees: 16,773
• Sector: Utilities
• Sector Strength: 65
• Industry: Diversified Utilities
• EPS (TTM): 1.28
• Shares Outstanding: 653,284,100
• 10 Day Avg. Volume: 3,774,832
• 30 Day Avg. Volume: 3,631,177
• PEG Ratio: -0.82
• Price to Book (P/B): 1.82
• Price to Sales (P/S): 4.20
• P/FCF Ratio: -9.53
• Enterprise Value/Market Cap: 1.61
• Enterprise Value/Revenue: 7.00
• Enterprise Value/Gross Profit: 23.88
• Enterprise Value/Ebitda: 15.80
• 1Y Price Target: $103.91
• Price Target Upside: 13.29% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 12
• EPS Forecast (FY): 5.12
• Revenue Forecast (FY): $14.25B

• Rating: 58 Neutral
• Price Target: $95.00 ▲(3.58% Upside)
• Action: Reiterated Date: 03/21/26
• Date: Action: Reiterated 03/21/26

The score is held back mainly by mixed financial performance (revenue pressure, uneven cash conversion, and 2025 operating-metric volatility) and a relatively expensive valuation for the profile. These are partially offset by a positive earnings-call outlook with reaffirmed/raised guidance and solid strategic and project execution signals, while technicals are broadly neutral.

Positive Factors

Oncor capital plan expansion

A >30% boost to Oncor's multi‑year capital plan meaningfully expands the regulated rate base, a durable driver of utility earnings. Higher long‑term capital investment supports allowed returns, predictable depreciation recovery and sustained cash flows across the 2026–2030 horizon.

LNG project execution

Progress toward commercial operation at major LNG projects shifts revenue from construction timing to contracted, capacity‑style cash flows. Successful project execution reduces development risk and supports durable, fee‑based revenue streams less sensitive to short‑term commodity swings.

Strategic asset monetization

Monetizing a large infrastructure stake crystallizes value and supplies strategic capital to fund regulated investments or reduce leverage. The planned multi‑year EPS accretion and cash proceeds enhance long‑term financial flexibility and support funding of growth initiatives without immediate equity dilution.

Negative Factors

Material revenue decline (2024–2025)

Sustained double‑digit revenue declines across consecutive years indicate weakened top‑line momentum and raise questions about durable earnings power. Lower revenue compresses headroom for reinvestment and magnifies sensitivity of cash generation to operational or regulatory volatility over the medium term.

Inconsistent free cash flow profile

Multi‑year negative free cash flow despite positive operating cash flows suggests heavy capital intensity and timing variability. Persistent weak cash conversion constrains self‑funding for capex, increases reliance on external financing and elevates refinancing and credit risks over the medium term.

Pending California regulatory and legal matters

Ongoing regulatory proceedings and litigation in California create enduring uncertainty around cost recovery, authorized returns and potential retroactive adjustments. These unresolved matters can materially affect allowed revenues, timing of cash flows and capital planning for core utility operations.

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 primarily makes money through (1) regulated utility earnings and (2) contracted energy infrastructure revenues, with results influenced by rate regulation, customer demand, and long-term commercial agreements. 1) Regulated utility revenue (rate-based earnings) - Regulated utilities generate revenue by delivering natural gas and electricity to customers within their service territories. Prices are generally set through regulatory proceedings rather than purely by market competition. - Under this model, the utility earns an allowed return on invested capital (the “rate base”), plus recovery of prudently incurred operating costs, as authorized by state regulators. Growth in earnings is typically driven by capital investment programs (e.g., upgrading pipelines, transmission/distribution networks, reliability and safety projects) that expand the regulated rate base. - Utility revenue is therefore largely tied to customer bills that include pass-through components (such as certain fuel/commodity costs where applicable) and regulated charges designed to recover infrastructure and operating costs and provide an authorized return. 2) LNG and energy infrastructure revenue (contracted / fee-based) - Sempra also earns revenue from LNG infrastructure by developing and operating LNG export facilities. These projects commonly generate cash flow via long-term contracts that include capacity-style or fixed fees for liquefaction services, with counterparties often responsible for sourcing the natural gas commodity. - This model tends to emphasize contracted, multi-year payments for access to liquefaction capacity and related services, rather than taking direct exposure to day-to-day commodity price movements. 3) Other contributing factors - Earnings can also be affected by the timing of regulatory decisions, authorized returns and capital structure assumptions set by regulators, customer growth and usage patterns, and execution of large-scale infrastructure projects. - Information on specific counterparties, contract terms, or partnership structures for individual assets is not provided here: null.

Sempra Energy Financial Statement Overview

Summary

Financials are mixed. Income statement trends are pressured by notable revenue declines in 2024–2025 and unusual 2025 operating-profit volatility (negative EBITDA/zero EBIT reported), raising earnings-quality uncertainty. The balance sheet looks serviceable for a regulated utility but with meaningful leverage and declining ROE. Cash flow remains a key weakness given multi-year negative free cash flow despite a better 2025.

Income Statement

Revenue has been pressured recently (down ~18% in 2024 and ~24% in 2025), which is a clear top-line headwind. Profitability is mixed: net margins remain healthy for a utility (roughly mid-teens to low-20s in most years), but 2025 shows unusual volatility with negative EBITDA and zero EBIT reported, suggesting one-time items or reporting noise that weakens confidence in the run-rate. Net income also stepped down from 2023–2024 levels.

Balance Sheet

Leverage is meaningful but broadly in-line for a large regulated utility: debt-to-equity has generally hovered around ~0.9–1.15, indicating a balance between debt funding and equity support. Return on equity has trended down from stronger levels earlier in the period (notably 2020) to mid-single digits in 2025, pointing to weaker earnings power versus the capital base. Overall, the capital structure looks serviceable, but declining returns and high absolute debt keep risk elevated.

Cash Flow

Cash generation is uneven. Operating cash flow is positive each year, but the level has been volatile (notably weak in 2022), and free cash flow was negative in most years (2020–2024), consistent with heavy utility capital spending and/or timing swings. While 2025 shows positive free cash flow and roughly matches net income, the sharp negative free-cash-flow growth signal and prior multi-year deficits suggest cash conversion is not consistently strong.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	13.71B	12.96B	15.80B	15.55B	13.06B
Gross Profit	4.00B	3.52B	3.75B	4.16B	3.64B
EBITDA	6.87B	5.85B	6.12B	4.42B	3.26B
Net Income	1.84B	2.86B	3.08B	2.14B	1.32B
Balance Sheet
Total Assets	110.88B	96.16B	87.18B	78.57B	72.05B
Cash, Cash Equivalents and Short-Term Investments	2.00M	1.56B	236.00M	370.00M	559.00M
Total Debt	36.29B	35.85B	31.08B	28.92B	24.64B
Total Liabilities	68.88B	58.37B	53.53B	49.32B	44.63B
Stockholders Equity	31.61B	31.24B	28.70B	27.14B	26.00B
Cash Flow
Free Cash Flow	-6.05B	-3.31B	-2.18B	-4.21B	-1.17B
Operating Cash Flow	4.57B	4.91B	6.22B	1.14B	3.84B
Investing Cash Flow	-12.21B	-9.12B	-8.72B	-5.04B	-5.51B
Financing Cash Flow	9.60B	5.42B	2.42B	3.78B	1.26B

Sempra Energy Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 91.72
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• 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 Neutral. The current price of 91.72 is below the 20-day moving average (MA) of 93.81, above the 50-day MA of 90.62, and above the 200-day MA of 85.12, indicating a neutral trend. The MACD of 0.85 indicates Positive momentum. The RSI at 45.91 is Neutral, neither overbought nor oversold. The STOCH value of 46.31 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SRE.

Sempra Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CIG	70 Outperform	$7.25B	10.08	14.29%	12.98%	-0.38%	-53.94%
SO	66 Neutral	$104.54B	22.16	12.50%	3.40%	9.40%	-6.05%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
BKH	64 Neutral	$5.12B	17.38	7.85%	3.91%	7.03%	6.64%
BIP	59 Neutral	$16.85B	35.60	9.74%	4.92%	8.14%	―
SRE	58 Neutral	$59.92B	31.37	5.82%	2.91%	9.07%	-28.58%
AES	52 Neutral	$10.05B	10.76	20.35%	5.06%	-1.55%	12.83%

Sempra Energy Corporate Events

Sempra’s SDG&E Unit Prices $1.1 Billion Bond Offering

On March 20, 2026, San Diego Gas & Electric closed a public offering of $625 million of 5.200% First Mortgage Bonds due 2036 and $475 million of 5.950% First Mortgage Bonds due 2056, raising proceeds at 99.104% and 98.517% of par, respectively, before expenses. The bonds, which pay semiannual interest starting September 15, 2026 and are redeemable before maturity under specified terms, strengthen the utility’s long-dated funding profile and support its capital investment program while locking in fixed-rate financing across 10- and 30-year maturities.

The most recent analyst rating on (SRE) stock is a Buy with a $106.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.

Sempra’s SDG&E Prices Dual-Tranche First Mortgage Bonds

On March 16, 2026, San Diego Gas & Electric Company entered into an underwriting agreement with a syndicate of investment banks to issue and sell $625 million of 5.200% First Mortgage Bonds due 2036 and $475 million of 5.950% First Mortgage Bonds due 2056. The bonds will be resold to investors in a registered public offering at slight discounts to par, reinforcing the utility’s access to long-term capital for its regulated operations and signaling continued investor appetite for its investment-grade debt.

The transaction, conducted under the company’s effective shelf registration statement with the U.S. Securities and Exchange Commission, underscores San Diego Gas & Electric’s ability to lock in fixed-rate funding across medium- and long-dated maturities. For stakeholders, the dual-tranche offering supports balance sheet flexibility and provides visibility on financing for future capital needs without immediately diluting existing equity holders.

The most recent analyst rating on (SRE) stock is a Hold with a $100.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.

Sempra Energy Completes $800 Million Senior Notes Offering

On March 13, 2026, Sempra completed a public offering of $800 million aggregate principal amount of 5.250% notes due March 15, 2036, generating approximately $793.4 million in net proceeds after underwriting discounts but before offering expenses. The notes, which were sold to a syndicate of major underwriters for resale at 99.823% of par, pay semi-annual interest starting September 15, 2026 and are redeemable at Sempra’s option before maturity, providing the company with long-term fixed-rate capital and balance sheet flexibility.

Issued under an existing indenture with U.S. Bank Trust Company, the 10-year notes further extend Sempra’s debt maturity profile and may support ongoing investment across its energy infrastructure portfolio. The successful placement with prominent banks underscores sustained market access for Sempra’s debt securities, which is important for funding capital-intensive projects and maintaining its position in the competitive utility and energy infrastructure sector.

The most recent analyst rating on (SRE) stock is a Hold with a $100.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.

Sempra’s Oncor Unit Reaches Settlement in Texas Rate Case

On January 29, 2026, Oncor Electric Delivery Company, 80.25%-owned by Sempra Energy, filed an unopposed settlement in its comprehensive base rate review in Texas, seeking approval for an annual revenue requirement of about $6.975 billion, representing an 8.8% increase and an estimated annualized revenue uplift of roughly $560 million over adjusted present revenues, alongside an updated capital structure of 56.5% debt and 43.5% equity, a higher authorized return on equity of 9.75%, and a higher authorized cost of debt of 4.94%. The settlement, which also raises the annual self-insurance reserve for storm and other self-insured losses to $200 million and introduces a five-year amortization period for certain regulatory balances, remains subject to modification or rejection by the Public Utility Commission of Texas, with a final order expected in the first half of 2026 and new rates, including surcharges back to January 1, 2026, anticipated to bolster Oncor’s future earnings, cash flow, and credit metrics if approved as requested.

The most recent analyst rating on (SRE) stock is a Buy with a $97.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.

SoCalGas Addresses Edison Cross-Claims in Eaton Fire Litigation

On January 21, 2026, SoCalGas responded publicly to cross-claims filed on January 16, 2026 by Southern California Edison in the ongoing Eaton Fire litigation, in which Edison named SoCalGas and more than a dozen other defendants. SoCalGas criticized the cross-claims as an effort by Edison to shift responsibility for the Eaton fire, pledged to vigorously defend its operational response during the emergency, and said it will seek to recover from Edison for damage to its own system. The company noted it is reviewing the allegations and will pursue insurance coverage, including wildfire insurance, for system damages and for the costs of defending both Edison’s claims and related lawsuits from the Palisades fire. SoCalGas also highlighted its year-long effort working with local and state officials to repair fire-damaged infrastructure and restore gas service safely to thousands of affected customers, underscoring its operational resilience and ongoing role in regional recovery from last year’s wildfires.

The most recent analyst rating on (SRE) stock is a Buy with a $95.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.