Sempra Energy Results Improve

Sempra Energy Reports Improved FY’08 Results

Sempra Energy (SRE - Analyst Report) announced financial results for its 4th quarter and full-year ended December 31, 2008.  Net income for the reported quarter increased 10.4% to $319 million, or $1.30 per diluted share ($1.32 basic), compared to $289 million, or $1.10 per diluted share ($1.12 basic), in the prior-year quarter. Quarterly income from continuing operations increased 10.8% to $319 million, or $1.30 per diluted share ($1.32 basic) in the reported quarter versus $288 million, or $1.10 per diluted share ($1.12 basic) in the year-ago period.

For fiscal 2008, income from continuing operations was $4.43 per diluted share, up 4.0% per share, compared to $4.26 per diluted share for fiscal 2007. Likewise, net income increased 1.3%, to $1.11 billion or $4.43 per diluted share in fiscal 2008 versus $1.10 billion or $4.16 per diluted share for fiscal 2007.

The Company also reaffirmed its earnings guidance for fiscal 2009 to a range of $4.35 to $4.60 per share.

Looking ahead, a base of stable earnings, steady progress at its LNG terminals, regulatory approval of utility rate cases and the Sunrise Powerlink transmission line, operational REX-West and completion of its first solar power project, collectively support the bullish outlook for SRE.

Furthermore, given a discount in P/E multiples, we maintain our BUY recommendation on SRE with a 6-month target price of $45.50. Price appreciation to our near-term valuation target -- coupled with a sustainable and secure, recently increased quarterly dividend of $0.39 per share based on low projected earnings payouts -- represents annualized total return potential of 23.9%.

Sempra Energy is an energy services utility holding company. The Company, through its business units, provides electric, natural gas and other energy products and services.

Read the full analyst report on SRE