Sempra Energy (SRE) AI Stock Analysis

• Market Cap: $56.95B
• Dividend Yield: 2.93%
• Average Volume (3M): 4.20M
• Price to Earnings (P/E): 21.1
• 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): 0.89
• Shares Outstanding: 652,472,400
• 10 Day Avg. Volume: 5,806,576
• 30 Day Avg. Volume: 4,195,406
• 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: 1.68
• Enterprise Value/Revenue: 7.21
• Enterprise Value/Gross Profit: 25.74
• Enterprise Value/Ebitda: 15.89
• 1Y Price Target: $88.13
• Price Target Upside: 1.90% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 71 Outperform
• Price Target: $91.00 ▲(5.21% Upside)

Sempra Energy's overall stock score reflects strong financial performance with robust revenue growth and profitability. The technical analysis indicates a positive trend, while the valuation is fair. The earnings call highlighted significant capital investments and strategic initiatives, though regulatory challenges and negative free cash flow are concerns. Overall, the stock presents a stable investment opportunity with growth potential.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand and effective business operations, strengthening Sempra's market position and long-term prospects.

Capital Investment

Significant capital investments in U.S. utilities suggest a commitment to infrastructure development, enhancing future growth and operational capabilities.

Infrastructure Achievements

Progress in LNG projects strengthens Sempra's infrastructure segment, supporting long-term revenue from international markets and energy export capabilities.

Negative Factors

Negative Free Cash Flow

Negative free cash flow, despite profitability, suggests cash flow management issues, potentially impacting financial flexibility and investment capacity.

Regulatory Challenges

Regulatory challenges in California could lead to increased costs and operational hurdles, affecting Sempra's profitability and strategic initiatives.

Rising Debt Levels

Rising debt levels may strain Sempra's financial health, limiting its ability to fund future growth and increasing vulnerability to interest rate changes.

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: 86.49
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 86.49 is above the 20-day moving average (MA) of 82.91, above the 50-day MA of 81.84, and above the 200-day MA of 77.71, indicating a bullish trend. The MACD of 1.17 indicates Negative momentum. The RSI at 64.21 is Neutral, neither overbought nor oversold. The STOCH value of 88.07 is Negative, 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
CIG	79 Outperform	6.72B	5.30	26.00%	15.50%	-3.27%	-3.44%
BKH	77 Outperform	4.36B	15.14	7.82%	4.46%	5.41%	-1.89%
ELP	72 Outperform	6.97B	13.58	11.89%	5.88%	-5.28%	14.50%
SRE	71 Outperform	$56.95B	21.13	8.87%	2.93%	0.46%	-11.77%
BIP	64 Neutral	20.35B	1,607.73	4.04%	5.38%	8.86%	―
AES	58 Neutral	9.51B	9.43	46.27%	5.37%	-3.19%	30.48%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%

Sempra Energy Corporate Events

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.