Financial Analysis: Sempra Energy (SRE) versus The Competition
Sempra Energy (NYSE: SRE) is one of 22 public companies in the “Multiline Utilities” industry, but how does it weigh in compared to its rivals? We will compare Sempra Energy to similar businesses based on the strength of its earnings, institutional ownership, analyst recommendations, profitability, valuation, dividends and risk.
Earnings & Valuation
This table compares Sempra Energy and its rivals gross revenue, earnings per share and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|Sempra Energy||$10.97 billion||$3.71 billion||16.59|
|Sempra Energy Competitors||$7.70 billion||$2.04 billion||20.47|
Sempra Energy has higher revenue and earnings than its rivals. Sempra Energy is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.
Insider and Institutional Ownership
80.8% of Sempra Energy shares are owned by institutional investors. Comparatively, 66.2% of shares of all “Multiline Utilities” companies are owned by institutional investors. 0.2% of Sempra Energy shares are owned by insiders. Comparatively, 3.1% of shares of all “Multiline Utilities” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Volatility and Risk
Sempra Energy has a beta of 0.55, suggesting that its stock price is 45% less volatile than the S&P 500. Comparatively, Sempra Energy’s rivals have a beta of 0.60, suggesting that their average stock price is 40% less volatile than the S&P 500.
This table compares Sempra Energy and its rivals’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Sempra Energy Competitors||8.42%||8.94%||2.33%|
This is a summary of current ratings for Sempra Energy and its rivals, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Sempra Energy Competitors||317||958||819||6||2.24|
Sempra Energy presently has a consensus price target of $121.60, indicating a potential upside of 8.62%. As a group, “Multiline Utilities” companies have a potential upside of 10.76%. Given Sempra Energy’s rivals higher possible upside, analysts clearly believe Sempra Energy has less favorable growth aspects than its rivals.
Sempra Energy pays an annual dividend of $3.29 per share and has a dividend yield of 2.9%. Sempra Energy pays out 48.7% of its earnings in the form of a dividend. As a group, “Multiline Utilities” companies pay a dividend yield of 3.1% and pay out 71.1% of their earnings in the form of a dividend. Sempra Energy has raised its dividend for 6 consecutive years.
Sempra Energy beats its rivals on 10 of the 15 factors compared.
About Sempra Energy
Sempra Energy is a holding company. The Company’s principal operating units are Sempra Utilities, which includes its San Diego Gas & Electric Company (SDG&E), Southern California Gas Company (SoCalGas) and Sempra South American Utilities segments, and Sempra Infrastructure, which includes its Sempra Mexico, Sempra Renewables and Sempra LNG & Midstream segments. As of December 31, 2016, SDG&E’s service area covered 4,100 square miles. Sempra South American Utilities operates Chilquinta Energia, which serves customers in the region of Valparaiso in central Chile. As of December 31, 2016, SoCalGas had natural gas franchises with the 12 counties and the 223 cities in its service territory. Sempra LNG & Midstream owns land in Simpson County, Mississippi Hub. Sempra LNG & Midstream owns land in Port Arthur, Texas. Sempra Renewables has operations, investments or development projects in the various United States markets.
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