Southwest Gas Holdings, Inc. (SWX)

Price$87.83Cached quoteAs of 2026-09-16 15:31 UTC

AI: Fair-priced

Price checkThe shares look roughly fairly priced because today’s valuation already assumes strong regulated growth.

At the observed market price, Southwest Gas trades at about 20.6 to 21.3 times management’s $4.17-$4.32 continuing-operations earnings-per-share guidance for 2026, and about 1.56 times June book value. Those are not bargain multiples for an 8.1% trailing utility return on equity and roughly 2.9% dividend yield. The counterweight is management’s 12%-14% annual earnings-growth target through 2030. That balance supports Fair-priced: substantial growth is already expected, but the valuation is not clearly extreme if execution remains strong.

Big pictureEarnings are improving, but heavy infrastructure spending still consumes more cash than operations produce.

The supplied history shows 2025 operating cash flow of about $556 million against roughly $808 million of capital spending, leaving about $252 million of negative free cash flow, meaning cash left after running and investing in the business. The first half of 2026 similarly produced about $308 million of operating cash against $529 million of capital spending. Regulatory mechanisms reduce sensitivity to gas volumes, although reported earnings remain seasonally stronger in winter. This spending can create future regulated earnings, but only if regulators permit timely recovery.

Business strengthDebt fell sharply after the Centuri exit, while equity and regulatory support strengthened downside protection.

Reported total debt declined from about $5.28 billion at 2023 year-end to $3.51 billion by June 2026, while stockholders’ equity rose from $3.31 billion to $4.13 billion. Net debt is still substantial at roughly $3.24 billion. Share count has risen about 27% since 2020, although dilution since 2024 is under 1%, and management says it does not expect an equity issuance in 2026. The annualized $2.58 dividend equals roughly 60%-62% of guided 2026 earnings, leaving some room to fund growth.

What could change the storyGreat Basin could lift long-term earnings, but its much larger budget raises financing and execution risk.

Great Basin now has binding commitments for roughly 1 billion cubic feet per day of 2028 capacity. Management estimates about $2.3 billion of project investment and $270-$300 million of annual incremental margin after completion, versus the $1.7 billion project assumption embedded in existing long-term guidance. Another 1.8 billion cubic feet of interest is not yet binding. The bull case is successful construction plus favorable Arizona and Nevada rate relief; the bear case is heavier debt or future dilution if spending arrives faster than regulatory revenue and project cash flows.

AI: News

Great Basin project expandsNew customer commitments enlarged the pipeline opportunity, while also increasing the capital Southwest Gas must finance.

On August 5, Southwest Gas said binding commitments for the 2028 Great Basin expansion had reached about 1 billion cubic feet per day. Estimated investment rose to approximately $2.3 billion, with potential annual incremental margin of $270-$300 million after the project enters service. Existing long-term guidance still assumes only $1.7 billion of Great Basin investment. Shares closed about 1.8% higher that day, although the move coincided with the company’s full quarterly results and cannot be attributed solely to this announcement.

California rate case finalizedCalifornia removed a major regulatory uncertainty, though the allowed shareholder return fell from its previous level.

The California commission’s final order, issued August 20, adopted a 50% debt and 50% equity capital structure and a 10.0% allowed return on equity, down from the previous 11.16%. It also approved a 5.17% rate increase for Northern California and South Lake Tahoe and 22.36% for Southern California, while making future interest-rate adjustments less volatile. Shares declined about 0.5% that day, but timing alone does not establish that the decision caused the move.

Great Basin financing approvedRegulators expanded Southwest Gas’s borrowing capacity, reducing funding uncertainty but allowing substantially more leverage.

On July 2, California regulators approved authority for Southwest Gas to issue up to $1.15 billion of additional debt, bringing authorized debt capacity to about $2.1 billion for financing that includes the Great Basin expansion. This is important because the project’s enlarged capital budget exceeds the amount assumed in current long-term guidance. The approval improves access to funding without requiring immediate equity issuance, but greater borrowing would increase interest costs and balance-sheet risk. Shares rose about 1.5% that day, with causation uncertain.

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Financial statements

	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
Revenue	$1.94B	$2.48B	$5.43B	$4.96B	$1.50B	$1.34B	$1.39B	$1.31B	$1.26B	$1.31B	$2.36B
Gross profit	$898.7M	$60.1M	$2.82B	$2.43B	−$457.7M	−$390.3M	−$187.9M	−$81.7M	$113.9M	$282.4M	—
Gross margin	46.31%	2.43%	51.83%	49.01%	−30.56%	−29.14%	−13.57%	−6.26%	9.02%	21.61%	—
Operating expenses	$1.47B	$2.07B	$2.52B	$4.98B	—	—	—	—	—	—	—
Operating income	$473.9M	$406.5M	$293.0M	−$24.4M	$369.5M	$423.0M	$371.8M	$357.4M	$343.1M	$315.5M	$288.3M
Operating margin	24.42%	16.42%	5.39%	−0.49%	24.67%	31.59%	26.84%	27.37%	27.17%	24.14%	12.22%
EBITDA	$804.6M	$709.6M	$588.4M	$446.1M	$740.6M	$755.0M	$675.0M	$606.6M	$594.1M	$604.6M	$558.4M
EBITDA margin	41.47%	28.67%	10.83%	8.99%	49.45%	56.38%	48.73%	46.45%	47.04%	46.26%	23.67%
Net income	$439.8M	$198.8M	$150.9M	−$203.3M	$200.8M	$232.3M	$213.9M	$182.3M	$193.8M	$152.0M	$138.3M
Net profit margin	22.67%	8.03%	2.78%	−4.10%	13.41%	17.35%	15.44%	13.96%	15.35%	11.63%	5.86%
Basic EPSper basic share	$6.09	$2.77	$2.13	-$3.10	$3.39	$4.15	$3.94	$3.69	$4.04	$3.20	$2.94
Diluted EPSper diluted share	$6.08	$2.76	$2.13	-$3.10	$3.39	$4.14	$3.94	$3.68	$4.04	$3.18	$2.92

Review official source filings ↗

Owners

Reported shareholders

Reference date Jun 30, 2026

15.43%of listed shares

BlackRock, Inc.11.18M shares · Jun 30, 2026

View holders

Top 20 reported holders of SWX
Holder	% owned
BlackRock, Inc.	15.43%11.18M shares
ICAHN CARL C / ICAHN PARTNERS LP / ICAHN PARTNERS MASTER FUND LP	≈8.33%6.03M shares
FMR LLC	7.70%5.58M shares
VANGUARD PORTFOLIO MANAGEMENT LLC	5.48%3.97M shares
Corvex Management LP	4.43%3.21M shares
VANGUARD CAPITAL MANAGEMENT LLC	4.21%3.05M shares
STATE STREET CORP	3.60%2.61M shares
GEODE CAPITAL MANAGEMENT, LLC	2.88%2.09M shares
MAVERICK CAPITAL LTD	2.61%1.89M shares
AQR CAPITAL MANAGEMENT LLC	2.21%1.6M shares
ADAGE CAPITAL PARTNERS GP, L.L.C.	1.87%1.35M shares
T. Rowe Price Investment Management, Inc.	1.57%1.14M shares
Channing Capital Management, LLC	1.48%1.07M shares
DIMENSIONAL FUND ADVISORS LP	1.46%1.06M shares
PRINCIPAL FINANCIAL GROUP INC	1.36%985.86K shares
GABELLI FUNDS LLC	1.31%950.84K shares
NORGES BANK	1.31%948.1K shares
NORTHERN TRUST CORP	1.23%892.39K shares
GOLDMAN SACHS GROUP INC	1.20%869.55K shares
River Road Asset Management, LLC	1.19%865.24K shares

Percentages use 72.44M shares of this listed class outstanding on Jun 30, 2026. ≈ compares the latest reported holding with a share total from a different date; it is not a confirmed current stake.

Gray completes the 100% scale. Reported positions may overlap; holders have different reporting dates.

Source: SEC Form 13F ↗Updated Sep 29, 2026 · Quarterly data

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys1$1.9K disclosed value

Sells (SEC code S)8$381.91M disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
Jan 9, 2026Form 4 · 10b5-1	Brown Justin LPresident/Southwest Gas Corp.	SellCommon Stock	3.0K	$81.08	$245.5K	6.3K
Sep 25, 2025Form 4	ICAHN CARL C +2TenPercentOwner	SellCommon Stock, $1.00 par value per share ("Shares") · indirect	1.50M	$77.91	$116.86M	6.03M
Sep 10, 2025Form 4	Sandoval Brian EDirector	BuyCommon Stock	24	$78.57	$1.9K	1.6K
Jun 27, 2025Form 4	Stefani Robert JSVP/CFO/Controller	SellCommon Stock	7.0K	$75.00	$525.0K	24.7K
Mar 28, 2025Form 4	Stefani Robert JSVP/Chief Financial Officer	SellCommon Stock	2.0K	$72.55	$145.1K	31.7K

Review ownership filings at SEC.gov ↗

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Southwest Gas Holdings, Inc. (SWX)

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