Mizuho analysts reaffirmed their Outperform rating for Sempra Energy (NYSE:SRE), maintaining a price target of $88 on the stock.

Following investor meetings in Boston and Toronto with Sempra’s CFO Karen Sedgwick, the analysts noted the company’s confidence in managing challenges related to the ECA delay and recent changes in the Cost of Capital (COC) mechanism as they approach 2025. The analysts highlighted that California’s regulatory environment continues to offer balanced returns and strong wildfire protection for both customers and investors.

Sempra’s subsidiary, Oncor, is also expected to receive approval for its SRP plan later this year, which has not yet been factored into Sempra's five-year forecast. Additionally, the $13-15 billion Permian Transmission project, in which Sempra holds a 40% stake, could provide further capital opportunities through 2038 but is not currently included in the company’s capex outlook.

The analysts also emphasized Sempra’s confidence in its LNG strategy, with management reaffirming plans to secure all output for the Port Arthur 2 (PA2) project by the third-quarter earnings call.