Sempra Energy reported a strong first quarter for 2026, with GAAP earnings of $1.37 billion ($1.58 per share), up from $906 million ($1.39 per share) in the same quarter last year. Adjusted earnings also saw an increase to $991 million ($1.51 per share) from $942 million ($1.44 per share). Key developments included the approval of Oncor’s base rate review, which enhances the authorized return on equity to 9.75%, and the introduction of a Universal Tariff Mechanism (UTM) that allows for the recovery of $4.4 billion in transmission and distribution assets.
These regulatory wins are significant as they improve financial returns and reduce regulatory lag, positioning Sempra for enhanced earnings growth. The company also identified $9 billion in incremental capital opportunities, primarily in Texas, indicating a focus on utility growth in that region. With a robust $65 billion capital plan, Sempra aims for long-term EPS growth of 7%-9%.
Market professionals should note that Sempra’s strategic focus on regulated utility investments, alongside its recent regulatory approvals, could lead to improved earnings stability and growth potential in the coming years.
Source: fool.com