Targa Resources Corp. Reports Record Earnings and Growth

Targa Resources Corp. ((TRGP)) has held its Q1 earnings call. Read on for the main highlights of the call.

Targa Resources Corp. recently held its earnings call, revealing a record quarter marked by strong financial performance and significant growth in the Permian Basin volumes. The company expressed a positive outlook despite facing challenges from winter weather and potential cost impacts from global tariffs. Targa’s robust financial position and increased dividends further underscore its optimistic sentiment.

Record Quarterly Adjusted EBITDA

Targa Resources Corp. reported a record quarterly adjusted EBITDA of $1.179 billion, marking a 22% increase from the previous year. This impressive growth was primarily driven by higher volumes in the Permian Basin and the company’s full ownership of its Badlands assets.

Significant Share Repurchases

The company took advantage of market conditions to repurchase nearly $215 million worth of common shares in 2025, with $125 million repurchased in the first quarter alone at an average price of $191.86 per share. This move reflects Targa’s commitment to returning capital to shareholders.

Strong Financial Position

Targa ended the first quarter with $2.7 billion of available liquidity and a pro forma consolidated leverage ratio of 3.6x, which is comfortably within its long-term target range of 3x to 4x. This strong financial footing allows the company to pursue strategic investments and shareholder returns.

Permian Basin Volume Growth

Despite facing several winter weather events, Targa’s natural gas inlet volumes in the Permian Basin averaged over 6 billion cubic feet per day, an 11% increase from the previous year. This growth highlights the resilience and operational efficiency of Targa’s assets.

Increased Common Dividend

Reflecting its strong financial performance, Targa declared a 33% increase in its common dividend for the first quarter of 2025 compared to 2024. This increase underscores the company’s commitment to delivering value to its shareholders.

Winter Weather Impacts

The company faced some challenges due to winter weather, which led to a 1% decline in Permian volumes quarter-over-quarter. However, Targa’s overall performance remained strong despite these temporary setbacks.

Potential Low-Single-Digit Cost Increases

Targa noted the potential for low-single-digit percentage increases in project costs due to evolving global tariffs. However, these potential impacts are within the company’s contingency plans, minimizing any significant disruption.

Crude Price Curve Shift

The company observed a shift to a lower crude price curve, which could influence future drilling programs. Targa is closely monitoring these developments to adjust its strategies accordingly.

Forward-Looking Guidance

Looking ahead, Targa maintains its full-year adjusted EBITDA guidance of $4.65 billion to $4.85 billion. The company plans to invest between $2.6 billion and $2.8 billion in net growth capital spending and estimates net maintenance capital spending at $250 million. Targa remains focused on maintaining a strong balance sheet, investing in high-return projects, and returning capital to shareholders through dividends and share repurchases.

In summary, Targa Resources Corp.’s earnings call highlighted a record-setting quarter with strong financial results and growth in the Permian Basin. Despite challenges such as winter weather and potential cost increases, the company maintains a positive outlook with strategic investments and shareholder returns as key priorities.