SRE 2017 Analyst Day

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Auvila_SRE_QN_Analyst_Day_2017_04_05

Excerpt:

Market Price (4/5/2017): $109.46/share; ST-Target: $160/share; NIV: $203/share

Excerpt:

Conservative 5-year outlook more than supports our $203 NIV/Share

As pointed out by the entire management team, we agree that SRE’s outlook is very conservative

  • CAGR in EPS through 2021: 10%-11% driven by $14.2B in capex of which some 92.6% goes to utes
  • CAGR in dividends through 2021: 8%-9%
  • Excess free cash flow of $1.5B would go towards:
    • Invest in additional growth projects,
    • Accelerate dividend payout, then
    • Share buyback

But, an additional up to $15B in opportunities could push CAGR well above 10%-11% through 2021

Opportunities specified by management include (but are not limited to):

  • Expansion of Cameron by two trains to a total of five increasing capacity by 9MM Metric Tons/Year
  • Addition of up to 2-liquefaction trains totaling ~12MM Metric Tons/Year to Port Arthur
  • Addition of up to 2-liquefaction trains totaling ~12MM Metric Tons/Year to Energia Costa Azul (ECA)
  • Addition of up to 2GW of renewable projects pushing SRE’s renewable portfolio to about 3.5GW

Opportunities that we believe SRE could pursue that was not mentioned by management:

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