Targa Resources (TRGP)
NYSE:TRGP
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Targa Resources
(NYSE:TRGP)
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Rating:72Outperform
Price Target:
$266.00
â–²(12.95% Upside)
Action:UpgradedDate:03/03/26
The score is driven primarily by improving profitability and strong cash generation, reinforced by upbeat 2026 guidance and visible multi-year growth projects. Momentum is technically strong but shows overbought signals, while valuation (P/E ~27.8 with a ~1.67% yield) and high leverage keep the overall score in the low-70s.
Positive Factors
High fee‑based cash flows & hedging
A primarily fee‑based revenue mix with multi‑year hedges meaningfully reduces commodity exposure and earnings volatility. This structural stability supports predictable operating cash flow to fund growth capex, dividends and debt reduction, improving long‑term planning and resilience.
Negative Factors
Elevated leverage
Very high reported leverage materially constrains financial flexibility and raises sensitivity to interest rates and capital‑market conditions. While recent profits and cash flow are strong, the modest equity base and high debt elevate refinancing, covenant and cyclicality risk over a multi‑quarter horizon.
Read all positive and negative factors
Positive Factors
Negative Factors
High fee‑based cash flows & hedging
A primarily fee‑based revenue mix with multi‑year hedges meaningfully reduces commodity exposure and earnings volatility. This structural stability supports predictable operating cash flow to fund growth capex, dividends and debt reduction, improving long‑term planning and resilience.
Read all positive factors
Targa Resources (TRGP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$51.70B
Dividend Yield2.03%
Average Volume (3M)1.41M
Price to Earnings (P/E)21.5
Beta (1Y)0.65
Revenue Growth3.38%
EPS Growth47.83%
CountryUS
Employees3,370
SectorEnergy
Sector Strength52
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)2.53
Shares Outstanding214,801,970
10 Day Avg. Volume1,242,065
30 Day Avg. Volume1,411,080
Financial Highlights & Ratios
PEG Ratio0.45
Price to Book (P/B)12.93
Price to Sales (P/S)2.31
P/FCF Ratio67.91
Enterprise Value/Market Cap1.37
Enterprise Value/Revenue4.13
Enterprise Value/Gross Profit15.58
Enterprise Value/Ebitda14.58
Forecast
1Y Price Target
$264.73Price Target Upside12.41% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering15
EPS Forecast (FY)10.15
Revenue Forecast (FY)$20.71B
Targa Resources Business Overview & Revenue Model
Company Description
Targa Resources Corp., together with its subsidiary, Targa Resources Partners LP, owns, operates, acquires, and develops a portfolio of midstream energy assets in North America. The company operates in two segments, Gathering and Processing, and L...
How the Company Makes Money
Targa Resources generates revenue primarily through its gathering, processing, and transportation of natural gas and NGLs. Key revenue streams include fees collected for gathering natural gas from producers, processing fees for separating natural ...
Targa Resources Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
The call conveyed a strong positive operational and financial performance story—record 2025 results (adjusted EBITDA +20%), robust Permian volume growth, multiple new project announcements (processing plants, frac train, fractionator, export expansion), and solid balance sheet metrics (net leverage ~3.5x, ~$1.9B liquidity). Management provided constructive 2026 guidance (+~11% adjusted EBITDA) and long-term visibility to >$6B run-rate EBITDA post-Speedway. Key near-term headwinds include Waha price volatility and weather-related volume impacts, an elevated near-term capital intensity as large projects are executed, and timing/execution risks for multi-year builds. Overall, highlights materially outweigh the lowlights, reflecting confident growth visibility and financial strength alongside manageable operational and timing risks.Positive Updates
Record Adjusted EBITDA
Full-year 2025 adjusted EBITDA of $4.96 billion, a 20% increase year-over-year versus 2024; Q4 2025 adjusted EBITDA of $1.34 billion, up 5% sequentially from Q3.
Negative Updates
Waha Price Volatility and Producer Shut-Ins
Sharp Waha basis volatility in late 2025 contributed to producer shut-ins in Q4 (though volumes later returned); management expects Waha volatility to continue through much of 2026, creating uncertainty and potentially uneven marketing opportunities.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Adjusted EBITDA
Full-year 2025 adjusted EBITDA of $4.96 billion, a 20% increase year-over-year versus 2024; Q4 2025 adjusted EBITDA of $1.34 billion, up 5% sequentially from Q3.
Read all positive updates
Company Guidance
Targa guided 2026 adjusted EBITDA of $5.4–$5.6 billion (midpoint roughly +11% vs. 2025) after a record 2025 adjusted EBITDA of $4.96 billion (>$800 million YoY increase) and Q4 adj. EBITDA of $1.34 billion; it expects low double‑digit Permian volume growth in 2026 (Q4 Permian averaged 6.65 Bcf/d and Permian volumes grew 11% in 2025, >600 MMcf/d) and plans ~ $4.5 billion of growth capital in 2026 (after ~$3.3 billion invested in 2025 and $226 million of maintenance capex). Management announced Yeti II and Fractionator 13, ordered long‑lead items for two Permian plants for early‑2028, and expects eight plants over the next two years that provide ~2.2 Bcf/d of incremental processing capacity and ~320,000 bpd gross NGL production; it will place three plants in service in 2026 (Falcon 2, East Pembrook, East Driver). Q4 NGL transport averaged 1.05 MMbpd, fractionation 1.14 MMbpd and LPG exports 13.5M bbl/month; Targa sees post‑Speedway run‑rate adj. EBITDA > $6 billion, anticipates multiyear growth capex of ~ $2.5 billion/yr in a ~3‑plants/yr (high‑single to low‑double digit) growth case, expects year‑end leverage around 3.5x (target 3–4x), had ~$1.9 billion liquidity at 1/31/26, repurchased $642 million of shares in 2025 (avg $170.45), is >90% fee‑based with most non‑fee margin hedged for three years, and does not expect meaningful cash taxes for ~5 years.Targa Resources Financial Statement Overview
Summary
Income Statement
77
Positive
Balance Sheet
48
Neutral
Cash Flow
72
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 17.14B | 16.63B | 15.62B | 21.68B | 17.44B |
| Gross Profit | 4.54B | 3.33B | 2.54B | 2.79B | 2.09B |
| EBITDA | 4.85B | 4.14B | 3.97B | 3.21B | 1.70B |
| Net Income | 1.84B | 1.27B | 828.20M | 1.14B | 71.20M |
Balance Sheet | |||||
| Total Assets | 25.22B | 22.73B | 20.67B | 19.56B | 15.21B |
| Cash, Cash Equivalents and Short-Term Investments | 166.10M | 157.30M | 141.70M | 219.00M | 158.50M |
| Total Debt | 17.55B | 14.27B | 13.01B | 11.56B | 6.63B |
| Total Liabilities | 22.02B | 18.32B | 16.06B | 14.58B | 10.03B |
| Stockholders Equity | 3.07B | 2.59B | 2.74B | 2.67B | 2.01B |
Cash Flow | |||||
| Free Cash Flow | 584.10M | 683.90M | 826.20M | 1.05B | 1.80B |
| Operating Cash Flow | 3.92B | 3.65B | 3.21B | 2.38B | 2.30B |
| Investing Cash Flow | -5.44B | -3.02B | -2.40B | -4.15B | -473.20M |
| Financing Cash Flow | 1.53B | -612.80M | -888.10M | 1.83B | -1.91B |
Targa Resources Technical Analysis
Neutral
235.50
Price Trends
236.05
Negative
209.45
Positive
185.87
Positive
Market Momentum
1.02
Positive
43.43
Neutral
25.24
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TRGP, the sentiment is Neutral. The current price of 235.5 is below the 20-day moving average (MA) of 244.00, below the 50-day MA of 236.05, and above the 200-day MA of 185.87, indicating a neutral trend. The MACD of 1.02 indicates Positive momentum. The RSI at 43.43 is Neutral, neither overbought nor oversold. The STOCH value of 25.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TRGP.
Targa Resources Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $54.02B | 8.01 | 79.10% | 1.07% | 24.44% | 70.66% | |
77 Outperform | $56.18B | 11.07 | 34.93% | 7.31% | 6.16% | 14.35% | |
75 Outperform | $55.13B | 13.64 | 15.47% | 5.61% | 54.99% | 4.45% | |
74 Outperform | $82.15B | 12.07 | 19.84% | 6.72% | -6.47% | -1.57% | |
72 Outperform | $51.70B | 21.51 | 68.22% | 2.03% | 3.38% | 47.83% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
63 Neutral | $2.70B | 13.53 | 461.30% | 9.78% | 7.73% | 10.09% |
* Energy Sector Average
TRGP
Targa Resources
241.29
67.27
38.65%
LNG
Cheniere Energy
259.40
23.83
10.12%
EPD
Enterprise Products Partners
38.22
9.47
32.96%
OKE
Oneok
87.75
4.53
5.44%
DKL
Delek Logistics
50.49
14.23
39.25%
MPLX
MPLX
54.61
6.48
13.46%
Targa Resources Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Targa Resources Completes $1.5 Billion Senior Notes Offering
Positive
Mar 2, 2026
On March 2, 2026, Targa Resources Corp. and certain subsidiaries completed an underwritten public offering of $1.5 billion in senior unsecured notes, split evenly between 4.350% notes due 2031 and 6.050% notes due 2056, fully and unconditionally g...
Business Operations and StrategyPrivate Placements and Financing
Targa Resources Prices $1.5 Billion Senior Notes Offering
Positive
Feb 26, 2026
On February 25, 2026, Targa Resources Corp. priced an underwritten public offering of $1.5 billion in senior notes, split evenly between 4.350% notes due 2031 and 6.050% notes due 2056, with the securities sold slightly below face value. The notes...
Business Operations and StrategyStock BuybackDividendsFinancial DisclosuresM&A TransactionsPrivate Placements and Financing
Targa Resources Posts Record 2025 Results, Hikes Dividend
Positive
Feb 19, 2026
Targa Resources reported record results for the fourth quarter and full year 2025, with net income rising to $545 million for the quarter and $1.923 billion for the year, and adjusted EBITDA climbing 20 percent year-on-year to $4.96 billion on sur...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.