Jefferies has adjusted its valuation outlook for Sempra Energy (NYSE:SRE), lowering the firm's price target to $89.00 from $95.00 while maintaining a Hold recommendation. The revised target is close to Sempra's recent market price of $85.94, and sits at the lower end of analyst targets that range from $87 to $112. Data from InvestingPro included in the research shows the shares trading slightly above the service's calculated Fair Value.
In explaining the change, Jefferies cited legal developments tied to Southern California Gas (SoCalGas). The firm highlighted litigation alleging negligence during the Eaton fire as a factor that complicates Sempra's risk profile. Jefferies noted that investors had historically treated Sempra's California utilities as having comparatively lower exposure to wildfire risk than many peers - a characterization that makes the litigation particularly meaningful for the company's perceived risk position.
Alongside the litigation concern, Jefferies said it lowered certain estimates to account for the California cost of capital and the possible outcomes of track two regulatory proceedings. The research note did not provide specific numerical revisions to those estimates.
Looking ahead, Jefferies singled out several items it considers key near-term catalysts. The firm emphasized an upcoming roll-forward update on the 2026-plus EPS compound annual growth rate (CAGR) and the expected size of an updated capital plan for Sempra's Texas operations. Jefferies suggested there could be a "better short-term risk/return" opportunity around the company's fourth-quarter earnings call.
Recent company results add context to the analyst debate. Sempra reported third-quarter 2025 adjusted earnings per share of $1.11, topping a consensus forecast of $0.92. Revenue also exceeded expectations, at $3.15 billion versus an anticipated $2.99 billion.
Brokerage responses have been mixed. Goldman Sachs upgraded Sempra to a Buy rating and set a $106.00 price target, citing the company's increased emphasis on Texas activities, improved management communication, recent legislative successes, and progress on balance sheet management through announced asset sales. In contrast, BMO Capital trimmed its price target slightly to $100.00 from $103.00 but maintained an Outperform rating; that adjustment followed a lawsuit brought by Edison International subsidiary Southern California Edison against Sempra's Southern California Gas unit.
On the shareholder return front, Sempra declared a quarterly dividend of $0.645 per share, payable on January 15, 2026, to holders of record as of December 11, 2025.
Taken together, the analyst actions, legal developments, and company results paint a picture of a business facing both operational momentum and heightened regulatory and litigation uncertainty. For market participants, the interplay of California regulatory outcomes, the scale of capital spending in Texas, and evolving cost-of-capital assumptions will likely shape near-term sentiment toward Sempra securities.