SRE Should I Buy
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Sempra (SRE) is not a strong buy for a beginner investor with a long-term focus at this time. The stock lacks immediate positive momentum, technical indicators are neutral or bearish, and financial performance has been declining. While analysts maintain an optimistic long-term outlook with upward price target revisions, the lack of recent trading signals, weak financials, and hedge fund selling suggest it is better to hold off on investing until clearer positive catalysts emerge.
The MACD is negative (-0.657) and contracting, indicating bearish momentum. RSI is neutral at 40.923, and moving averages are converging, showing no clear trend. The stock is trading near its support level (S1: 92.709), with resistance at 98.805. Overall, technical indicators suggest a neutral to bearish outlook.
Analysts have raised price targets recently, with firms like Wells Fargo and Barclays maintaining Overweight ratings. Sempra's focus on utility growth in California and Texas, along with upcoming earnings and regulatory updates, could provide long-term growth opportunities.
Hedge funds are aggressively selling, with a 788.08% increase in selling activity last quarter. Financial performance in Q4 2025 showed significant declines in revenue (-0.24% YoY), net income (-47.07% YoY), and EPS (-48.08% YoY). The stock has a 70% chance of declining -9.4% in the next month based on historical patterns.
Sempra's Q4 2025 financials were weak, with revenue dropping to $3.75 billion (-0.24% YoY), net income falling to $352 million (-47.07% YoY), and EPS declining to 0.54 (-48.08% YoY). Gross margin also dropped to 68.79 (-3.86% YoY), reflecting deteriorating profitability.
Analysts maintain a positive long-term outlook, with multiple firms raising price targets recently. Current price targets range from $100 to $118, with Overweight and Buy ratings from firms like Wells Fargo, Morgan Stanley, and Truist. However, the stock's current price of $93.5 is below the lowest price target, indicating potential upside if long-term catalysts materialize.
