BUZZ-Street View: Investors bet on Sempra's Texas story despite unclear long term growth plan
U.S. utility Sempra SRE.N on Tuesday lowered its 2025 profit forecast amid regulatory challenges and high costs while also missing adjusted profit estimates for fourth-quarter profit
Median PT of 19 analysts is $87.50
LONG TERM GROWTH PLAN UNCLEAR
Morningstar cuts PT to $77 from $85, says weak earnings and delays at Sempra Infrastructure, along with disappointing general rate case outcome in California and higher costs in Texas, will weigh on earnings this year
Guggenheim ("buy") cuts PT to $87 from $95, says management commentary on long-term growth rate unclear, which put off investors, but see "no fundamental changes to the story outside of CA, which has already been on our regulatory risk radar, and financing drag"
Mizuho ("outperform") cuts PT to $76 from $92, says company surprised investors on a call with a significant EPS rebase which "essentially wiped out ~1.5 years of EPS growth", but continues to see "see value in SRE's Texas growth story"
Morgan Stanley ("overweight") cuts PT to $85 from $100, says The Texas thesis remains intact; see ~20% upside in the stock from current levels even after modeling for conservative assumptions
Wells Fargo cuts PT to $88 from $96
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