Sempra (SRE) Could Be 17% Undervalued As Earnings And Guidance Reset The Debate

Sempra (SRE) stock is reacting to fresh numbers after the company reported second quarter 2026 results, with higher net income and earnings per share, and adjusted its 2026 outlook while reaffirming 2027 guidance.

See our latest analysis for Sempra.

At a share price of US$85.94, Sempra has seen its short term share price performance soften, with a 30 day share price return down 6.84%. However, longer term total shareholder returns of 9.18% over one year and 52.43% over five years point to a more supportive picture as the latest earnings and guidance updates feed into expectations and risk perception.

If Sempra's earnings update has you thinking about where energy infrastructure capital might head next, it could be worth scanning 39 power grid technology and infrastructure stocks for potential ideas that fit your watchlist.

The recent pullback in Sempra after its updated 2026 outlook and reaffirmed 2027 guidance puts the focus squarely on price. Does it make more sense to commit capital now or wait for a cheaper entry point as sentiment settles?

Most Popular Narrative: 17% Undervalued

The most followed narrative on Sempra points to a fair value of $103.50 compared with the current $85.94 share price. This frames the recent pullback in a different light.

The rollout and completion of major LNG export projects (ECA Phase 1 nearing completion, Port Arthur Phase 1 advancing, and strong commercial momentum for Phase 2) positions Sempra to benefit from sustained global demand for U.S. LNG as a transition fuel, significantly increasing future cash flows and long-term revenue generation.

Read the complete narrative.

Want to see how LNG volumes, margin expansion, and a future profit multiple come together to back that fair value? The narrative rests on a detailed earnings and cash flow roadmap that is not in the headline numbers.

Result: Fair Value of $103.50 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, Sempra's heavy investment in regulated utilities and growing reliance on LNG projects means regulatory shifts, policy changes or weaker LNG economics could quickly challenge this undervaluation story.

Find out about the key risks to this Sempra narrative.

Another View On Sempra Using Market Multiples

The narrative fair value suggests Sempra is 17% undervalued at $103.50, but the current P/E of 24.8x tells a tougher story. That is higher than both the Global Integrated Utilities industry at 18.7x and peers at 20.6x, even though the fair ratio sits at 26.1x. This gap points to less obvious upside and some valuation risk if sentiment cools. Which signal do you trust more when you think about your entry price?

See what the numbers say about this price — find out in our valuation breakdown.

Next Steps

If the mix of optimism and concern around Sempra feels finely balanced, now is a good time to review the underlying data and pressure test your own thesis. To frame both sides clearly, start with the 2 key rewards and 2 important warning signs.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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