Southwest Gas (SWX) Q4 2025 Earnings Transcript

The Motley Fool

by newsfeedback@fool.com (Motley Fool Transcribing)

February 25, 2026

AI-Generated Deep Dive Summary

Southwest Gas (SWX) reported a strong Q4 2025 performance, with adjusted net income rising 8.7% year-over-year to $203.9 million, surpassing guidance due to higher-than-expected COLI and interest income. The company also achieved a 19% increase in adjusted EPS to $3.65, driven by operational improvements and reduced debt obligations. Notably, Southwest Gas completed the repayment of its holding company debt post-the Century separation, leading to a credit rating upgrade from S&P to BBB+. The company's capital plan for 2026-2030 totals $6.3 billion, with 73% allocated to Southwest Gas and 27% to Great Basin. The Great Basin Expansion Project is on track, with $1.7 billion invested and nearly 800,000 Mcf/day of binding commitments secured. This project is expected to generate incremental annual margins of $215-$245 million upon completion. Southwest Gas has advanced its regulatory agenda in Arizona and Nevada, seeking rate hikes that could add over $100 million in revenue. The company's liquidity position remains robust, with nearly $600 million in cash and total available liquidity exceeding $1.3 billion, supporting dividend growth and capital investments. The board approved a 4% annualized dividend increase to $2.58 per share, reflecting confidence in future cash flows. The company’s strategic focus on regulatory filings and project execution positions it for sustained EPS growth of 12-14% over the next five years. This front-loaded growth, particularly in 2028 and 2029, aligns with advancing regulatory approvals and project milestones. Southwest Gas's transition to a fully regulated utility business, coupled with its strong financial performance and debt repayment, underscores its commitment to long-term value creation for shareholders. For investors, Southwest Gas’s improved credit profile, significant capital investments in growth projects, and consistent dividend increases highlight the company’s potential for sustained financial outperformance. The alignment of regulatory filings with customer demand and strategic project execution further solidifies its position as a reliable utility provider.

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Originally published on The Motley Fool on 2/25/2026