Sempra SRE
Sempra's Q2 2026 GAAP earnings of $796 million ($1.21 per diluted share) marked a sharp rebound from $461 million in the prior-year quarter, with management affirming 2026–2027 guidance and completing the Ecogas México sale to advance capital recycling. Yet the stock at $84.57 trades below both its 50-day ($90.18) and 200-day ($91.40) moving averages, carrying a P/E of 24.37 — a 16.3% premium to the peer median of 20.96 — against a backdrop of FY2025 free cash flow of -$6.05B on $10.6B of capex and $36.3B of total debt.
BNY Mellon's new $465M institutional position and the earnings inflection are constructive, but with smart money scores deteriorating to -0.02 as of Q2 2026 and the stock yet to reclaim key technical levels, the premium valuation and balance-sheet risk warrant patience.
What could go wrong
- Capital intensity and negative FCF. FY2025 free cash flow was -$6.05B on $10.6B of capex; FCF has been negative for at least five consecutive years, pressuring the ability to fund dividends and debt service organically.
- Premium valuation vs peers. P/E of 24.37 sits 16.3% above the peer median of 20.96 and P/S of 4.06 is 27.1% above the peer median of 3.20, leaving little margin for disappointment if the earnings recovery stalls.
- Balance-sheet leverage. Total debt of $36.3B against stockholders' equity of $31.6B (FY2025) amplifies sensitivity to interest-rate movements and regulatory cost-of-capital decisions.
- Deteriorating smart-money positioning. Smart money score fell from 0.0787 (Q1 2026) to -0.0201 (Q2 2026) with fund count declining from 66 to 63, signaling reduced institutional conviction at the margin.
What would change my mind
Where this comes from: Defense World Q2 earnings call highlights, 2026-08-11 · FMP fundamentals, fiscal year ended 2025-12-31 · Peer relative valuation, as of 2026-08-24 · Defense World, 2026-08-22 (13F filing). Orin's read on SRE; not advice.
Twelve months actual closes to 2026-09-24 · actual filings
50-day average 200-day average · volume below
On file
All SRE filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Wellington Management Group Llp | $4.1B | 0.7% of fund |
| Vanguard Capital Management | $4.0B | 0.1% of fund |
| State Street | $3.5B | 0.1% of fund |
| Vanguard Portfolio Management | $3.5B | 0.2% of fund |
| Morgan Stanley | $2.3B | 0.1% of fund |
| Jpmorgan Chase & | $1.9B | 0.1% of fund |
107 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 148 Form 4 filings, net $35.0M. Of the 50 on hand, 3 were open-market purchases and 8 sales— the rest are grants, option exercises and tax withholding.
Ask Orin about SRE
Orin answers questions about SRE from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 22.4× | 22.8× | 25.9× |
| EV/EBITDA | 13.4× | 15.4× | — |
| P/S | 3.74× | 3.16× | — |
| P/B | 1.6× | 1.8× | — |
Its P/E sits 40th percentile of its own last 5 years (−0.25σ from its own mean).
What Wall Street published
$101
$84 – $118 · +31% against today's price
- 21 buy or overweight
- 5 hold
- 0 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| SRESempra | $51B | 22.4× | 13.4× | 41.7% | 16.8% | 7% |
| AEPAmerican Electric Power Company, Inc. | $64B | 20.2× | 13.6× | 49.0% | 13.9% | 10% |
| DDominion Energy, Inc. | $53B | 20.9× | 14.5× | 49.3% | 13.9% | 9% |
| ETREntergy Corporation | $46B | 24.8× | 13.7× | 38.9% | 13.5% | 10% |
| EXCExelon Corporation | $41B | 14.7× | 10.2× | 24.5% | 11.0% | 10% |
| NEENextEra Energy, Inc. | $158B | 16.9× | 15.0× | 71.8% | 32.0% | 17% |
| PEGPublic Service Enterprise Group Incorporated | $33B | 16.5× | 13.2× | 85.4% | 16.0% | 12% |
| VSTVistra Corp. | $47B | 23.0× | 10.2× | 13.0% | 13.9% | 41% |
| WECWEC Energy Group, Inc. | $33B | 19.4× | 13.6× | 62.0% | 16.7% | 12% |
| XELXcel Energy Inc. | $43B | 19.0× | 12.5× | 48.8% | 15.3% | 10% |
The median is of the 9 peers listed above and nothing else — check it against the column. This company trades 15.5% above it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Discounted cash flow
| Model | Fair value | Against | Computed |
|---|---|---|---|
| Standard DCF | $-185 | $91.50 · −302% | 2026-06-10 |
| Levered DCF | $-200 | $91.50 · −319% | 2026-06-10 |
The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.