Sempra Energy (SRE) Stock Forecast & Price Target

Sempra Energy has outlined a robust capital plan of $36.1 billion for 2025-2029, marking a 34% increase, which reflects significant investment opportunities and expected customer growth in Texas. The company reported a $203 million increase in net income from its California operations due to higher income tax benefits, improved electric transmission margins, and regulatory adjustments, positioning Sempra positively for sustained earnings growth. Additionally, management's strategy to pursue more frequent rate case filings aims to align revenue with its capital investments, further enhancing its ability to improve return on equity while minimizing rate lag.

Sempra Energy's recent financial performance highlights significant challenges, most notably a fourth-quarter earnings per share (EPS) miss and a substantial downward revision of its 2025 EPS guidance, which was reduced by 58 cents from prior expectations. The company is facing decreased net income across its core business segments, including Sempra California and Sempra Texas, attributed to regulatory setbacks, higher operational costs, and adjustments in capital recovery, leading to a projected long-term EPS growth that falls short of market expectations by approximately 9%. Additionally, Sempra Infrastructure reported a notable decline in net income, exacerbated by lower contributions from its transportation and renewable energy segments, indicating an overall loss of momentum in EPS growth prospects.