Sempra Energy

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SRE : NYSE : Utilities
$101.77 -0.07 | -0.07%
Today's Range: 101.17 - 102.33
Avg. Daily Volume: 1297900.0
01/13/17 - 4:02 PM ET

Financial Analysis


SEMPRA ENERGY's gross profit margin for the third quarter of its fiscal year 2016 has increased when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. SEMPRA ENERGY has very weak liquidity. Currently, the Quick Ratio is 0.26 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity decreased from the same period a year ago, despite already having very weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 6.19% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)2535.02481.0
EBITDA ($mil)785.0677.0
EBIT ($mil)457.0362.0
Net Income ($mil)622.0248.0


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)532.0710.0
Total Assets ($mil)45526.040566.0
Total Debt ($mil)17295.014792.0
Equity ($mil)12366.011645.0


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin30.9727.29
EBITDA Margin30.9627.28
Operating Margin18.0314.59
Sales Turnover0.220.25
Return on Assets2.983.15
Return on Equity10.9910.96
Debt Q3 FY16 Q3 FY15
Current Ratio0.430.7
Debt/Capital0.580.56
Interest Expense169.0167.0
Interest Coverage2.72.17


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)250.0248.0
Div / share0.760.7
EPS2.460.99
Book value / share49.4646.96
Institutional Own % n/a n/a
Avg Daily Volume1291783.01182093.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 19.89 for the Multi-Utilities industry and a discount compared to the S&P 500 average of 25.49. For additional comparison, its price-to-book ratio of 2.06 indicates a discount versus the S&P 500 average of 2.84 and a discount versus the industry average of 2.22. The current price-to-sales ratio is well above the S&P 500 average and above the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, SEMPRA ENERGY proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
SRE 18.86 Peers 19.89   SRE 10.14 Peers 8.08

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

SRE is trading at a valuation on par with its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

SRE is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
SRE 19.85 Peers 17.44   SRE NM Peers 1.38

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

SRE is trading at a premium to its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

SRE's negative PEG ratio makes this valuation measure meaningless.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
SRE 2.06 Peers 2.22   SRE 6.29 Peers -59.39

Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

SRE is trading at a valuation on par with its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

SRE is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
SRE 2.54 Peers 2.44   SRE -2.56 Peers -4.22

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

SRE is trading at a valuation on par with its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

SRE has a sales growth rate that significantly exceeds its peers.

 

 

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