Sempra Energy (SRE) Stock Forecast & Price Target

Sempra Energy demonstrates a strong financial outlook driven by its substantial capital investment plan of $36.1 billion for Texas, representing a 34% increase, which is expected to enhance net income through higher rates and customer growth. In California, a $203 million increase in net income reflects benefits from tax items and improved margins, indicating effective management of operational costs and a positive regulatory environment. Furthermore, management anticipates iterative rate case filings will further boost earnings, coupled with a potential $12 billion upside to its current five-year plan, thus enhancing the company's revenue-generating capacity in the long term.

Sempra Energy's recent earnings reports reveal a significant negative outlook driven by multiple factors, including a fourth-quarter EPS miss and a notable reduction in 2025 EPS guidance, which was lowered by 58 cents from prior expectations. The company is also facing challenges in its California and Texas operations, with lower net incomes attributed to regulatory setbacks, increased operational costs, and delays in capital recoveries, leading to a forecasted EPS growth rate that could fall approximately 9% short of market consensus by 2028. Additionally, challenges within Sempra Infrastructure, including lower contributions from its transportation business and a weaker renewables segment, further compound the company's difficulties, effectively resulting in the loss of an entire year of expected EPS growth.