Head-To-Head Analysis: Sempra Energy (NYSE:SRE) and Spire (NYSE:SR)

Sempra Energy (NYSE:SRE) and Spire (NYSE:SR) are both utilities companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, dividends, earnings, profitability, analyst recommendations, valuation and risk.

Earnings and Valuation

This table compares Sempra Energy and Spire”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sempra Energy	$13.19 billion	3.68	$2.86 billion	$4.55	16.35
Spire	$2.59 billion	1.68	$250.90 million	$4.06	18.21

Sempra Energy has higher revenue and earnings than Spire. Sempra Energy is trading at a lower price-to-earnings ratio than Spire, indicating that it is currently the more affordable of the two stocks.

Dividends

Sempra Energy pays an annual dividend of $2.58 per share and has a dividend yield of 3.5%. Spire pays an annual dividend of $3.14 per share and has a dividend yield of 4.2%. Sempra Energy pays out 56.7% of its earnings in the form of a dividend. Spire pays out 77.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sempra Energy has increased its dividend for 22 consecutive years and Spire has increased its dividend for 22 consecutive years.

Profitability

This table compares Sempra Energy and Spire’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sempra Energy	22.15%	8.55%	3.24%
Spire	10.22%	8.49%	2.39%

Institutional & Insider Ownership

89.7% of Sempra Energy shares are owned by institutional investors. Comparatively, 87.4% of Spire shares are owned by institutional investors. 0.3% of Sempra Energy shares are owned by insiders. Comparatively, 2.3% of Spire shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility & Risk

Sempra Energy has a beta of 0.63, indicating that its stock price is 37% less volatile than the S&P 500. Comparatively, Spire has a beta of 0.62, indicating that its stock price is 38% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Sempra Energy and Spire, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sempra Energy	0	6	7	0	2.54
Spire	1	5	3	1	2.40

Sempra Energy presently has a consensus price target of $80.83, indicating a potential upside of 8.68%. Spire has a consensus price target of $77.40, indicating a potential upside of 4.69%. Given Sempra Energy’s stronger consensus rating and higher probable upside, research analysts clearly believe Sempra Energy is more favorable than Spire.

Summary

Sempra Energy beats Spire on 13 of the 17 factors compared between the two stocks.

About Sempra Energy

Sempra operates as an energy infrastructure company in the United States and internationally. It operates through three segments: Sempra California, Sempra Texas Utilities, and Sempra Infrastructure. The Sempra California segment provides electric services; and natural gas services to San Diego County. As of December 31, 2023, it offered electric services to approximately 3.6 million population and natural gas services to approximately 3.3 million population that covers 4,100 square miles. This segment owns and operates a natural gas distribution, transmission, and storage system that supplies natural gas. As of December 31, 2023, it serves a population of 21 million covering an area of 24,000 square miles. The Sempra Texas Utilities segment engages in the regulated electricity transmission and distribution. As of December 31, 2023, its transmission system included 18,298 circuit miles of transmission lines; 1,257 transmission and distribution substations; interconnection to 173 third-party generation facilities totaling 54,277 MW; and distribution system included approximately 4.0 million points of delivery and consisted of 125,116 miles of overhead and underground lines. The Sempra Infrastructure segment develops, builds, operates, and invests in energy infrastructure to help enable the energy transition in North American markets and worldwide. The company was formerly known as Sempra Energy and changed its name to Sempra in May 2023. Sempra was incorporated in 1996 and is based in San Diego, California.

About Spire

Spire Inc., together with its subsidiaries, engages in the purchase, retail distribution, and sale of natural gas to residential, commercial, industrial, and other end-users of natural gas in the United States. The company operates through three segments: Gas Utility, Gas Marketing, and Midstream. It is also involved in the marketing of natural gas and related services; and transportation and storage of natural gas. In addition, the company engages in the operation of propane through its propane pipeline, risk management, and other activities. The company was formerly known as The Laclede Group, Inc. and changed its name to Spire Inc. in April 2016. Spire Inc. was founded in 1857 and is based in Saint Louis, Missouri.