Sempra Energy stock price target raised to $95 by Wolfe Research

Investing.com - Wolfe Research has raised its price target on Sempra Energy (NYSE:SRE) to $95.00 from $91.00 while maintaining an Outperform rating on the stock. The utility company, with a market capitalization of $56.15 billion and a beta of 0.66, has demonstrated consistent dividend growth, raising payments for 14 consecutive years. InvestingPro data shows the stock currently offers a 3% dividend yield.

The firm cited Sempra’s three high-quality utility franchises in California and Texas, which operate under constructive regulation and are located in above-average growth territories, particularly Texas.

Wolfe Research noted that Sempra has a stake in SI, with Mexican energy assets and an LNG export business that owns the Cameron’s facility under take-or-pay contracts, plus upside potential with ECA 1, Port Arthur 1, and Port Arthur 2 terminals.

The research firm highlighted that Sempra sees $12 billion of upside capital expenditure for 2027-29 from its Texas utility, and after its SI stake sale closes, Sempra’s business mix will be approximately 95% utilities and 5% SI.

Wolfe Research’s $95 price target is based on an average utility price-to-earnings ratio on 2027 estimated earnings of $5.61, with the firm noting that Sempra is taking the right steps and has high conviction on hitting the top end of its 7-9% earnings per share growth or better through 2029.

In other recent news, Sempra announced a quarterly dividend of $0.645 per share on its common stock, payable on October 15, 2025, to shareholders of record as of October 1, 2025. Additionally, the company declared a semi-annual dividend of $24.375 per share on its 4.875% Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock, Series C. Sempra Infrastructure, a subsidiary of Sempra, has entered into a 20-year sales and purchase agreement with EQT Corporation for 2 million tonnes per annum of liquefied natural gas from the Port Arthur LNG Phase 2 project in Texas. The LNG will be purchased on a free-on-board basis at a price indexed to Henry Hub.

Furthermore, California Senate Bill 254, known as the 2025 Wildfire Legislation, became effective, establishing the Wildfire Fund Continuation Account with up to $18 billion in additional liquidity for catastrophic wildfire-related claims for large California electric investor-owned utilities, including Sempra’s subsidiary, San Diego Gas & Electric Company. SDG&E intends to participate and submit notice by the deadline. In related developments, Sempra’s stock saw a slight increase following reports of the $18 billion boost to California’s wildfire utility fund. These recent developments highlight Sempra’s ongoing strategic activities and financial commitments.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.