Strong Q3 Numbers Set the Scene
It’s not every day you see a company cough up numbers that speak volumes. Sempra’s third quarter for 2026 paints a picture of solid performance, boasting earnings of $877 million or $1.34 per diluted share per GAAP standards. That’s an eye-opener compared to the paltry $77 million or $0.12 per share they reported same time last year. Adjusted, they're talking $917 million, or $1.40 per share up from $728 million, or $1.11. They didn't just meet expectations—they blew the doors off.
Guiding High into the Future
Now, before you jump to conclusions with dollar signs in your eyes, Sempra's not just sitting pretty. They're ramping up the stakes, guiding their 2026 adjusted EPS to the higher end of $4.80 to $5.30. Oncor’s getting a 20% capital plan boost—there’s got to be something in that Texas air.
“We look forward to completing the planned sale of an equity stake in Sempra Infrastructure Partners, with a view toward supporting strong growth in our Texas and California utilities and strengthening our financial position.” — Jeffrey W. Martin, CEO
Infrastructure Investment: Big Spending in Key Areas
Let’s talk about where the money's going. Sempra's pouring nearly $10 billion into capital over the first nine months of 2026 alone. That's the kind of heavy lifting that not only maintains but builds new bones in the infrastructure game. Their Oncor Electric Delivery Company LLC has ambitious plans, looking to ramp up their 2027-2031 base capital plan by 20%. They're ready to meet the burgeoning demand in the Texas power grid, which hit an all-time system peak of 33.3 gigawatts this quarter.
Selling Stakes and Recycling Capital
Intent on freshening up their financial arteries, Sempra’s planning to finalize the sale of a 45% equity stake in Sempra Infrastructure Partners to KKR affiliates soon. It’s a strategic move, a bit of capital recycling to keep things lean and mean. The sale’s supposed to go down in the next two weeks, a swift push towards simplifying their business model.
California and Texas: A Tale of Two States
While Texas is flexing its energy muscle, over in California, Sempra is navigating a different playing field. SDG&E is focused on weathering any storm, literally and figuratively, optimizing the grid to withstand fire season pressures. They hit a new peak energy demand of 5.2 GW in the third quarter, fueled by preparations and modern infrastructure.
Regulatory Headwinds and Opportunities
But it’s not all sunny skies. The California Public Utilities Commission laid down a proposed decision that refused to correct SDG&E's capital revenue requirements for post-2024. If not overturned, it could mean Sempra’s Cali operations will skate on thin ice earnings-wise come 2027, hitting the lower end of their guidance range.
It’s a mixed bag out there, folks. Whether Sempra can dodge these regulatory bullets while staking claims with strategic investments—in both volatile California and the surging Texas market—will be one for the books. Keep your eyes peeled, SRE might just surprise you yet again.
