Diversified Utilities · NYSE
Current Price
$92.64
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on Sempra with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
Sempra operates as an energy-services holding company in the United States and internationally. The company's San Diego Gas & Electric Company segment provides electric services; and supplies natural gas. It offers electric services to approximately 3.6 million population and natural gas services to approximately 3.3 million population that covers 4,100 square miles. Its Southern California Gas Company segment owns and operates a natural gas distribution, transmission, and storage system that supplies natural gas to a population of approximately 22 million covering an area of 24,000 square miles. The company's Sempra Texas Utilities segment engages in the regulated transmission and distribution of electricity serving 3.8 million homes and businesses, and operation of 140,000 miles of transmission and distribution lines. Its transmission system includes 18,249 circuit miles of transmission lines, a total of 1,174 transmission and distribution substations, and interconnection to 130 third-party generation facilities totaling 45,403 megawatts. The company was formerly known as Sempra Energy and changed its name to Sempra in July 2021. Sempra was founded in 1998 and is headquartered in San Diego, California.
ROIC (TTM)
2.6%
ROE (TTM)
5.8%
FCF Yield
-9.99%
Based on trailing twelve-month data, SRE shows a free cash flow per share of N/A and a ROIC of 2.6%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of -9.99% are important context metrics when evaluating SRE's stock valuation relative to peers.
The intrinsic value of SRE depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether SRE is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $92.64. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on Sempra: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Diversified Utilities industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting SRE's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Sempra, this means projecting how much free cash flow the Diversified Utilities will produce over the next 5-10 years, then discounting those amounts to today's dollars. SRE's ROIC of 2.6% suggests the company may face challenges generating returns above its cost of capital.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For SRE, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
