Sempra Energy (SRE) AI Stock Analysis

• Market Cap: $60.34B
• Dividend Yield: 2.77%
• Average Volume (3M): 3.20M
• Price to Earnings (P/E): 22.4
• Beta (1Y): 0.62
• Revenue Growth: 0.46%
• EPS Growth: -11.77%
• Country: US
• Employees: 16,773
• Sector: Utilities
• Sector Strength: 65
• Industry: Diversified Utilities
• EPS (TTM): 1.11
• Shares Outstanding: 652,472,400
• 10 Day Avg. Volume: 2,487,305
• 30 Day Avg. Volume: 3,199,691
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.67
• Enterprise Value/Revenue: 7.60
• Enterprise Value/Gross Profit: 27.15
• Enterprise Value/Ebitda: 16.76
• 1Y Price Target: $99.91
• Price Target Upside: 8.14% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 12
• EPS Forecast (FY): 4.53
• Revenue Forecast (FY): $14.26B

• Rating: 72 Outperform
• Price Target: $103.00 ▲(11.48% Upside)

Sempra Energy's overall stock score is driven by strong earnings call insights and positive technical analysis, indicating a bullish trend. Financial performance is solid but hampered by cash flow challenges, and valuation is moderate. The strategic focus on capital allocation and operational efficiency enhances the growth outlook, despite some regulatory hurdles.

Positive Factors

Revenue Growth

Robust revenue growth indicates strong demand and effective market positioning, enhancing long-term business sustainability.

Strategic Capital Allocation

Effective capital allocation supports infrastructure expansion and operational efficiency, driving future growth and profitability.

Long-term EPS Growth

Consistent EPS growth guidance reflects strong strategic planning and execution, ensuring sustained shareholder value creation.

Negative Factors

Cash Flow Challenges

Negative free cash flow could limit financial flexibility and investment capacity, impacting long-term growth and stability.

Regulatory Challenges

Ongoing regulatory challenges in key markets may affect operational efficiency and increase compliance costs, impacting profitability.

GAAP Earnings Decline

Significant GAAP earnings decline due to tax expenses could signal underlying financial pressures, affecting investor confidence.

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 utility operations, which earn returns on investments through rate structures approved by state regulators. This includes customer charges for electricity and natural gas distribution services. Additionally, the company earns revenue from its infrastructure segment by providing transportation and storage services for natural gas and developing renewable energy projects, which can include long-term contracts with customers. Key revenue streams also include fees from its LNG facilities and partnerships with other energy companies for joint ventures and development projects, enhancing its earnings potential in the growing energy market.

Sempra Energy Financial Statement Overview

Summary

Sempra Energy demonstrates robust profitability with a solid gross profit margin of 42.1% and a net profit margin of 22.2%. However, challenges include high leverage with a debt-to-equity ratio of 1.19 and negative free cash flow growth at -23.3%. The company efficiently utilizes equity with a return on equity of 9.4%, but needs to address cash flow management and leverage.

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	13.23B	12.96B	15.80B	15.55B	13.06B	11.35B
Gross Profit	3.71B	3.52B	3.75B	4.16B	3.64B	3.28B
EBITDA	6.00B	5.85B	6.12B	4.42B	3.26B	4.23B
Net Income	2.71B	2.86B	3.08B	2.14B	1.32B	3.93B
Balance Sheet
Total Assets	99.91B	96.16B	87.18B	78.57B	72.05B	66.62B
Cash, Cash Equivalents and Short-Term Investments	180.00M	1.56B	236.00M	370.00M	559.00M	960.00M
Total Debt	38.59B	35.85B	31.08B	28.92B	24.64B	24.21B
Total Liabilities	61.61B	58.37B	53.53B	49.32B	44.63B	41.69B
Stockholders Equity	31.72B	31.24B	28.70B	27.14B	26.00B	23.39B
Cash Flow
Free Cash Flow	-4.37B	-3.31B	-2.18B	-4.21B	-1.17B	-2.08B
Operating Cash Flow	4.65B	4.91B	6.22B	1.14B	3.84B	2.59B
Investing Cash Flow	-10.51B	-9.12B	-8.72B	-5.04B	-5.51B	553.00M
Financing Cash Flow	5.70B	5.42B	2.42B	3.78B	1.26B	-2.37B

Sempra Energy Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 92.39
• 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 Positive. The current price of 92.39 is above the 20-day moving average (MA) of 92.02, above the 50-day MA of 87.69, and above the 200-day MA of 78.30, indicating a bullish trend. The MACD of 1.21 indicates Positive momentum. The RSI at 59.07 is Neutral, neither overbought nor oversold. The STOCH value of 58.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SRE.

Sempra Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BKH	78 Outperform	$4.69B	16.29	8.13%	4.20%	5.41%	-1.89%
CIG	76 Outperform	$6.63B	5.33	22.94%	12.06%	-3.27%	-3.44%
SRE	72 Outperform	$60.34B	22.39	8.87%	2.77%	0.46%	-11.77%
BIP	69 Neutral	$15.75B	1,757.22	1.06%	4.90%	8.86%	―
SO	69 Neutral	$102.11B	23.05	13.06%	2.99%	9.40%	-6.05%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
AES	59 Neutral	$9.57B	8.18	23.02%	4.95%	-1.55%	12.83%

Sempra Energy Corporate Events

Sempra Energy Sells Stake in Infrastructure Partners

On September 22, 2025, Sempra entered into a purchase and sale agreement to sell 45% of the outstanding Class A Units and all general partner interests of Sempra Infrastructure Partners to KKR and Canada Pension Plan Investment Board for $9.99 billion. The transaction, expected to close in the second or third quarter of 2026, involves cash payments, promissory notes, and adjustments based on performance and capital expenditures. Post-closing, KKR will own 65% of Sempra Infrastructure Partners, with Sempra retaining certain control rights. The agreement includes provisions for potential project developments and financial commitments, impacting Sempra’s strategic positioning and financial obligations.

The most recent analyst rating on (SRE) stock is a Buy with a $86.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.

Sempra Energy Faces Operational and Regulatory Challenges

Sempra Energy‘s recent announcement highlights various risks and uncertainties that could impact its operations, including potential work stoppages, disruptions in electric power and natural gas availability, and regulatory challenges affecting Oncor Electric Delivery Company LLC’s dividends. These factors could lead to operational disruptions, financial liabilities, and challenges in obtaining insurance, posing significant implications for the company’s stakeholders.

The most recent analyst rating on (SRE) stock is a Buy with a $86.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.

Sempra Energy Completes $800M Junior Notes Offering

On August 29, 2025, Sempra Energy successfully completed a public offering of $800 million in junior subordinated notes with a 6.375% fixed-to-fixed reset rate due in 2056. The proceeds, approximately $792 million after underwriting discounts, are intended to help redeem outstanding shares of the company’s Series C preferred stock, pending board approval. This financial maneuver is part of Sempra’s strategic efforts to optimize its capital structure, potentially impacting its financial flexibility and shareholder value.

The most recent analyst rating on (SRE) stock is a Buy with a $87.00 price target. To see the full list of analyst forecasts on Sempra Energy stock, see the SRE Stock Forecast page.

Sempra Energy Reports Mixed Q2 2025 Results

Sempra is a leading North American energy infrastructure company, delivering energy to nearly 40 million consumers across California, Texas, Mexico, and global markets, recognized for its sustainable business practices and operational excellence.

Sempra Energy’s Earnings Call: Stability and Strategic Growth

Sempra Energy’s recent earnings call conveyed a generally positive sentiment, highlighting stable financial performance and strategic capital investments. The company affirmed its guidance and showcased significant progress in U.S. utilities and infrastructure projects. Legislative advancements in Texas and strides in LNG and renewable projects further underscored the optimistic outlook. However, the call also acknowledged challenges such as decreased GAAP earnings and ongoing regulatory reviews in Texas, alongside California’s affordability issues.