PG&E vs Sempra Which Should You Buy?

PG&E Corporation and Sempra Energy are two major players in the utility industry, with both companies providing essential services to millions of customers across different regions. PG&E has faced significant financial challenges in recent years, including bankruptcy filings and unprecedented wildfires, causing fluctuations in its stock performance. In contrast, Sempra has maintained a more stable financial position and continues to demonstrate growth potential in the energy market. Investors must carefully consider the risks and opportunities associated with these two stocks before making investment decisions.

PG&E or Sempra?

When comparing PG&E and Sempra, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between PG&E and Sempra.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. PG&E has a dividend yield of 0.19%, while Sempra has a dividend yield of 2.67%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. PG&E reports a 5-year dividend growth of 0.00% year and a payout ratio of 3.11%. On the other hand, Sempra reports a 5-year dividend growth of -0.06% year and a payout ratio of 50.56%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with PG&E P/E ratio at 16.32 and Sempra's P/E ratio at 19.18. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. PG&E P/B ratio is 1.42 while Sempra's P/B ratio is 7.40.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, PG&E has seen a 5-year revenue growth of -0.63%, while Sempra's is 0.15%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with PG&E's ROE at 10.15% and Sempra's ROE at 12.79%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $20.58 for PG&E and $90.52 for Sempra. Over the past year, PG&E's prices ranged from $15.94 to $21.15, with a yearly change of 32.69%. Sempra's prices fluctuated between $66.40 and $92.66, with a yearly change of 39.55%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.