Key Stats for Sempra Stock
- Past week’s performance: -3%
- 52-week range: $62to $96
- Valuation model target price: $100
- Implied upside: 15.6% over the next 1.9 years
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What Happened?
Sempra (SRE) stock traded near the middle of its 52‑week range this week, and it hovered around $86 as the market digested recent events and looked ahead to earnings later this month.
The shares were generally range‑bound, but modest weakness showed up as investors weighed interest‑rate expectations against the stability of regulated utility cash flows.
Sempra is scheduled to report Fiscal Year 2025 results on February 25, 2026, so traders focused on how guidance might reflect capital spending plans, rate decisions, and progress across its California, Texas, and infrastructure businesses.
In early January, management presented at Evercore’s 12th Annual Leading the Charge: Power & Utility Conference, and that appearance reinforced Sempra’s long‑term infrastructure strategy without providing a new catalyst for the share price.
The stock has also been absorbing the impact of its December 2025 cash dividend of $0.645 per share, and the 3.1% dividend yield continues to anchor the valuation as income‑oriented investors weigh alternatives in a shifting rate environment.
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Is Sempra Stock Undervalued?
Under valuation model assumptions realized through 2027 the stock is modeled using:
- Revenue growth (CAGR): 3.2%
- Operating margins: 25.0%
- Exit P/E multiple: 17x
Based on these inputs, the model estimates a target price of $100 implying a 15.6% total return from the current share price of $86 and a 7.9% annualized return over the next 1.9 years.
Those assumptions sit close to Sempra’s current fundamentals, because the company already generates a 41.3% gross margin and a 21.6% EBIT margin on a trailing basis, with forward two‑year EBITDA expected to grow around 7.4% annually.
Growth will likely depend on regulated capital investments in California and Texas, as Sempra Texas Utilities and Sempra California continue upgrading transmission lines, distribution networks, and gas infrastructure to support reliability and clean‑energy goals.
At the same time, the Sempra Infrastructure segment is investing in projects that expand access to cleaner energy in the United States, Mexico, and other markets, so execution there could support earnings and cash‑flow growth if projects come online on time and on budget.
Leverage remains elevated with LTM Net Debt around $32.7 billion and Net Debt/EBITDA of 5.43x, so investors are watching how upcoming results balance capital spending, dividends, and potential deleveraging against regulated returns.
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