DBA Sempra 5.750% Junior Subordinated Notes due 2079 (SREA)

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I approach SREA as a creditor, not an owner. It is a 5.750% junior subordinated note due 2079 from a utilities issuer, so my first question is whether the parent's earnings can safely carry a subordinated claim for another half-century. In fiscal 2025, the year ended 2025-12-31, filed revenue was $12.4B, net income $1.8B, and diluted EPS $2.75. Revenue rose from $11.8B in fiscal 2024, the year ended 2024-12-31, but net income fell from $2.9B and EPS from $4.42; fiscal 2023, the year ended 2023-12-31, was stronger at $14.8B revenue, $3.1B net income, and $4.79 EPS. The supplied Lynch category calls it a slow grower with profit shrinking 14.9% a year over five years and revenue growth of 3.8%, so I see no obvious growth moat. Recent quarters are mixed: in fiscal Q1 2026, the quarter ended 2026-03-31, revenue was $3.4B, net income $1.0B, and diluted EPS $1.58, versus fiscal Q1 2025, the quarter ended 2025-03-31, revenue of $3.7B, net income $917M, and EPS $1.39. Yet in fiscal Q3 2025, the quarter ended 2025-09-30, net income was only $95.0M and EPS $0.12. At $18.85 on 2026-10-16, near the 52-week low of $18.43 and far below the $23.49 high, the note is discounted. But P/E, P/B, ROE, ROCE, and D/E are not available, so I cannot verify asset or interest coverage. The discount may compensate for long duration and subordination, not create a provable margin of safety.

In plain English: This is a long-term bond-like security from a utilities company, not common stock, paying 5.750% interest and maturing in 2079. In fiscal 2025, the year ended 2025-12-31, filed revenue was $12.4B and net income was $1.8B, but net income was $2.9B in fiscal 2024, so the business looks less strong than before. At $18.85 on 2026-10-16, the price is near the 52-week low of $18.43; without issue-level coverage data, it is hard to say if it is cheap, fair, or expensive.

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Data as of 2026-10-16 close · note generated 2026-10-20 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · fiscal Q1 2025 10-Q (period ended 2025-03-31) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer