Southwest Gas Holdings Inc

Southwest Gas Holdings reported second-quarter net income of $42.1 million, a sharp turnaround from a $40.2 million loss a year earlier, but the standout was the Great Basin 2028 Expansion Project, where capital costs are now expected to reach $2.3 billion, up from the prior $1.7 billion guidance. The company has secured binding agreements for about 1 billion cubic feet per day of contracted demand and sees another 1.8 billion cubic feet in expressions of interest for later phases, projecting annual margin of $270 million to $300 million once the pipeline is in service. Regulators in California, Nevada, and Arizona have advanced rate cases and mechanisms that add incremental revenue, though the California cost-of-capital decision is still pending. Core gas distribution earnings slipped to $40.8 million from $45.6 million, and the profit swing relied heavily on a one-time tax comparison. The company reaffirmed its full-year 2026 guidance and ended the quarter with $270.5 million in cash and nearly $1 billion in available liquidity.

Southwest Gas Holdings reported second-quarter 2026 adjusted earnings of 45 cents per share, missing the Zacks Consensus Estimate of 47 cents by 4.3% while still rising 21.6% from the prior-year quarter. Operating revenues fell 9.6% to $358.2 million, below the $407 million consensus, as total operating expenses declined 17.5% to $273.8 million, driving a 30.8% increase in operating income to $84.3 million. The company reaffirmed its 2026 EPS guidance of $4.17 to $4.32 and highlighted that its Great Basin expansion secured binding agreements for about 1 billion cubic feet per day of demand, requiring roughly $2.3 billion in capital investment and expected to generate an annual incremental margin of $270 to $300 million once in service. Cash and equivalents stood at $270.5 million as of June 30, 2026, down from $576.6 million at year-end 2025, while net cash from operations in the first half was $308.2 million compared with $417.6 million a year earlier.

Southwest Gas Holdings has declared a third quarter 2026 cash dividend of $0.645 per share on its common stock. The dividend is payable on September 1, 2026, to shareholders of record as of August 17, 2026, and equates to $2.58 per share on an annualized basis. The company has paid quarterly dividends continuously since going public in 1956.

Southwest Gas holds an edge over Spire based on stronger earnings estimate revisions, a lower debt-to-capital ratio, and superior recent stock price performance, according to a Zacks Investment Research analysis. The Zacks Consensus Estimate for Southwest Gas projects earnings per share of $4.27 in 2026 and $4.85 in 2027, implying year-over-year growth of 16.99% and 13.63%, while Spire's estimates of $4.00 in 2026 and $5.51 in 2027 represent a 9.91% decline followed by 37.75% growth. Southwest Gas' debt-to-capital stands at 46.11%, well below Spire's 69.95% and the industry average of 54.47%, and its shares have gained 5.8% over the past three months compared with a 12.9% decline for Spire. Southwest Gas plans to invest $6.3 billion from 2026 to 2030, while Spire's capital plan totals $4.8 billion over the same period. Both stocks currently carry a Zacks Rank of 3, or Hold.