Why Southwest Gas Holdings (SWX) is Back on Investor Radars
Southwest Gas Holdings (SWX) has drawn fresh attention after unveiling a US$6.3 billion investment plan for 2026 to 2030, paired with higher earnings estimates and reaffirmed 2026 guidance for its regulated utility business.
See our latest analysis for Southwest Gas Holdings.
The reaffirmed 2026 guidance and US$6.3b investment plan come as Southwest Gas Holdings trades at US$88.72, with a year-to-date share price return of 10.69% and a 1-year total shareholder return of 28.57%. These figures indicate building momentum over the medium term.
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With the stock up 28.57% over the past year and trading at US$88.72, while sitting about 11.6% below the current US$99 analyst price target, is there still a buying opportunity here or is future growth already priced in?
Most Popular Narrative: 11.3% Undervalued
With Southwest Gas Holdings last closing at $88.72 against a narrative fair value of $100, the current share price sits below that central view and puts extra focus on the growth and margin story behind it.
Accelerated infrastructure investment opportunities, exemplified by the Great Basin pipeline expansion project with potential $1.2 to $1.6 billion in new capital expenditures, are expected to drive significant rate base growth, supporting higher future regulated revenue and earnings.
Want to see what underpins that $100 figure? Analysts are baking in faster revenue expansion, fatter margins, and a richer future earnings multiple. Curious which assumptions really move the needle here? The full narrative lays out the step by step logic behind that valuation call.
Result: Fair Value of $100 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, this depends on decarbonization policies and on large projects like the Great Basin pipeline avoiding setbacks that could limit demand or reduce future returns.
Find out about the key risks to this Southwest Gas Holdings narrative.
Another Way of Looking at Valuation
The fair value narrative points to $100 per share, but the current P/E of 26.9x sits well above the fair ratio of 21.3x, the peer average of 17.4x, and the global gas utilities average of 14x. That gap suggests investors are paying a premium, so the question is how comfortable you are with that difference in valuation.
See what the numbers say about this price — find out in our valuation breakdown.
Next Steps
With sentiment looking cautiously optimistic, it helps to move quickly, review the full picture, and weigh both the upside and the potential weak spots yourself using the 1 key reward and 2 important warning signs.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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