Targa Resources (TRGP) has received a new Hold rating, initiated by TD Cowen analyst, Jason Gabelman.
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Jason Gabelman has given his Hold rating due to a combination of factors related to Targa Resources’ current market position and future growth prospects. The company is well-positioned in the NGL value chain, particularly in the Permian region, which provides it with a unique advantage against industry headwinds. However, the anticipated growth in processing volumes and infrastructure expansion seems to be already reflected in the current stock price, suggesting limited upside potential.
While Targa Resources is expected to continue outperforming its peers due to its strong customer base and strategic positioning, the overall growth trajectory might slow down due to a deceleration in Permian NGL output. The company’s valuation appears to be fully priced in, considering the aggressive growth estimates. Additionally, while there is sufficient infrastructure for NGLs, the overbuild in export capacity presents a potential risk, which contributes to the Hold rating.