# Targa Resources (TRGP.US)

Canonical: https://gigainvestors.com/s/TRGP

Analysis as of: 2026-10-16T07:32:29.472Z. Financial observations: FY2008–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: $282.55 per share; close as of 2026-10-15.

Estimated value: low $24.86 per share, central $28.29 per share, high $32.85 per share. Buy at or below the central value $28.29 per share. Valuation as of 2026-10-16T07:32:29.472Z; scenarios are not confidence intervals.

Expected annual return: 3.7% at the stated quote. About 3.7% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: fail

- 4 revenue declines in the last 10 years (informational)

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 4

- Years with a net loss: 2

- Operating margin variation: 0.55×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.04×

- FY2018: 0.05×

- FY2019: 0.02×

- FY2020: 0.15×

- FY2021: 0.10×

- FY2022: 0.11×

- FY2023: 0.14×

- FY2024: 0.18×

- FY2025: 0.20×

- LTM to Jun 2026: 0.23×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 10.6%

- ROIC, second-lowest year: 1.8%

- Typical minus recent gross margin: -5.4 pp

- Typical gross margin (annual median): 14.6%

- Recent gross margin (lower of latest and 3-year median): 20.0%

- Years with nonpositive capital: 0

- Capital spending / revenue: 15.0%

- ROIC including acquisitions, ten-year median: 0.3%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 1.8%

- FY2017: 2.3%

- FY2018: 3.8%

- FY2019: 1.2%

- FY2020: 9.8%

- FY2021: 20.8%

- FY2022: 16.4%

- FY2023: 11.4%

- FY2024: 14.2%

- FY2025: 13.3%

### economics: fail

- owner earnings cash conversion below threshold

- Owner earnings / net income, 5-yr: 0.44×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $2.3B

- Net income, five-year total: $5.2B

- Return on incremental invested capital: 27.7%

- Working capital / revenue, annual change: -0.1 pp

- Working capital / revenue, change between three-year averages: -0.0 pp

- Working capital / revenue, final three-year average: 0.5%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.87×

- FY2022: 1.00×

- FY2023: -0.27×

- FY2024: 0.56×

- FY2025: 0.27×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 2.3% vs 13.3%

- Per-share earnings: 0.26 to 5.74 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 15.0%

- Ordinary dilution, 5-year annual growth: -1.4%

- Market cap gain: $29B

- Cumulative retained earnings: $2.5B

- Diluted shares, 10-year annual growth: 15.0%

- Diluted shares, 5-year annual growth: -1.4%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 47.1%

- Per-share value change: $5.48

- Per-share value, starting three-year median: $0.26

- Per-share value, ending three-year median: $5.74

- Buybacks concentrated in cheaper years (correlation): 0.42

- Average buyback yield: 2.0%

- Buyback history: 9 years

- Debt-funded buybacks: No

- Acquisition spending: $2.2B

- Cumulative net income, 10 years: $3.3B

- ROIC, first three-year median: 2.3%

- ROIC, last three-year median: 13.3%

Chart: Earnings per share; fiscal year observations.

- FY2016: -$1.21

- FY2017: $0.26

- FY2018: $0.01

- FY2019: -$0.90

- FY2020: -$6.69

- FY2021: $0.31

- FY2022: $4.94

- FY2023: $3.66

- FY2024: $5.74

- FY2025: $8.50

### accounting: pass

- Sloan accruals: -8.2%

- Receivables to sales index (DSRI): 0.88×

- Restructuring years, last five: 1

- Stock compensation / operating cash flow: 1.8%

- Earnings backed by cash: Yes

- Operating cash / earnings: 2.12×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.57×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -8.0%

- FY2017: -6.2%

- FY2018: -6.7%

- FY2019: -8.5%

- FY2020: -20.8%

- FY2021: -14.7%

- FY2022: -6.3%

- FY2023: -11.5%

- FY2024: -10.5%

- FY2025: -8.2%

## Holders

- [Matthew McLennan](https://gigainvestors.com/FE): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Bill Nygren](https://gigainvestors.com/HA): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Price needs cash profits to grow 30.9% a year for ten years · sales -2%

Story as of 2026-10-16T09:59:43.051Z; price observation 2026-10-15.

Price needs cash profits to grow 30.9% a year for ten years

- 2025-05-06: Targa Resources Q1 Earnings Miss Estimates, Expenses Increase Y/Y ([finance.yahoo.com](https://finance.yahoo.com/news/targa-resources-q1-earnings-miss-111000397.html))

- 2025-08-08: Targa’s Outlook Lifts on Record NatGas, NGL Volumes in Permian ([finance.yahoo.com](https://finance.yahoo.com/news/targa-outlook-lifts-record-natgas-160400804.html))

- 2025-11-06: Targa Resources (TRGP) Profit Margin Improves, Challenging Valuation Concerns With Slower Growth Ahead ([finance.yahoo.com](https://finance.yahoo.com/news/targa-resources-trgp-profit-margin-111418051.html))

- 2026-08-17: Targa Resources signs 20-year midstream deals with Exxon, plans three new Permian gas plants ([seekingalpha.com](https://seekingalpha.com/news/4634148-targa-resources-signs-20-year-midstream-deals-with-exxon-plans-three-new-permian-gas-plants?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

### Sales · FY2025–2026

sales -2%; source https://www.sec.gov/Archives/edgar/data/1389170/000119312526059296/trgp-20251231.htm; observed 2026-02-19.

- FY2017: $8.9B 

- FY2018: $11B 

- FY2019: $8.7B 

- FY2020: $8.3B 

- FY2021: $17B 

- FY2022: $22B 

- FY2023: $16B 

- FY2024: $17B 

- FY2025: $17B 

- FY2026: $17B 

### Gross margin · FY2025

gross margin 26.5%; source https://www.sec.gov/Archives/edgar/data/1389170/000119312526059296/trgp-20251231.htm; observed 2026-02-19.

- FY2016: 6.2% 

- FY2017: 5.9% 

- FY2018: 7.4% 

- FY2019: 17.2% 

- FY2020: 18.4% 

- FY2021: 12.0% 

- FY2022: 12.9% 

- FY2023: 16.2% 

- FY2024: 20.0% 

- FY2025: 26.5% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in oil & gas midstream; annual sales are USD 17.1 billion.

- Source: https://www.sec.gov/Archives/edgar/data/1389170/000119312526059296/trgp-20251231.htm (filed 2026-02-19); FY2025: revenue 17136200000; grossProfit 4542900000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); TRGP.US: Targa Resources Corp., together with its subsidiaries, owns, operates, acquires, and develops a portfolio of complementary domestic infrastructure assets in North America. It operates in two segments, Gathering and Processing, and Logistics and Transportation. The company is involved in gathering, compressing, treating, processing, transporting, and selling natural gas; storing, fractionating, treating, transporting, and selling natural gas liquids (NGL) and NGL products, including services to liquefied petroleum gas exporters; and gathering, storing, terminaling, purchasing, and selling crude oil. It is involved in the purchase and resale of NGL products; and sale of propane, as well as provision of related logistics services to multi-state retailers, independent retailers, and other end-users. In addition, the company offers NGL balancing services; and transportation services to refineries and petrochemical companies in the Gulf Coast area, as well as purchases, markets, and resells natural gas. The company also leased and owned railcars, tractors, vacuum trucks and pressurized NGL barges. Targa Resources Corp. was incorporated in 2005 and is headquartered in Houston, Texas.

### Why customers stay

Margins ranged from 16.2% to 26.5% during 2023–25; it earns 10.6% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2023: grossProfit / revenue = 16.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2024: grossProfit / revenue = 20%.

- Source: https://www.sec.gov/Archives/edgar/data/1389170/000119312526059296/trgp-20251231.htm (filed 2026-02-19); FY2025: grossProfit / revenue = 26.5%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); 10-year return on capital observations [[2016,0.017768745083008897],[2017,0.023288820360325632],[2018,0.038122365074449584],[2019,0.012275638185611523],[2020,0.09830907374259919],[2021,0.20833994264420816],[2022,0.16375353657958464],[2023,0.11423361335898603],[2024,0.1416897744668417],[2025,0.1333853307915061]]; median 0.10627134355079261. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Spends 94.7% of cash earnings on expansion; earns 27.7% on new investment.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2016: growth capex 0; upkeep 562100000; owner earnings 8300000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2017: growth capex 488000000; upkeep 809500000; owner earnings 54000000. Growth capex / owner earnings = 9.037037037037036.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2021: growth capex 0; upkeep 505100000; owner earnings 132852688.93627103. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2022: growth capex 238300000; upkeep 1096000000; owner earnings 1142300000. Growth capex / owner earnings = 0.20861419942221834.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2024: growth capex 986424803.513819; upkeep 1979375196.486181; owner earnings 713124803.513819. Growth capex / owner earnings = 1.3832428750947294.

- Source: https://www.sec.gov/Archives/edgar/data/1389170/000119312526059296/trgp-20251231.htm (filed 2026-02-19); FY2025: growth capex 471272674.67212677; upkeep 2862027325.327873; owner earnings 497672674.67212677. Growth capex / owner earnings = 0.9469530851429754.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); Incremental return on capital 0.2766423275798703, from the economics test's unchanged annual inputs.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); Dividend observations: [[2016,565900000],[2017,843200000],[2018,908300000],[2019,964800000],[2020,395900000],[2021,187500000],[2022,379700000],[2023,427300000],[2024,615500000],[2025,818300000]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/1389170/000119312526059296/trgp-20251231.htm (filed 2026-02-19); FY2025: cash repurchases 641800000 USD.

### Are managers owners

Insiders own 1.4% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); TRGP.US SharesStats.PercentInsiders = 1.379 percentage points; cache date 2026-10-16.

### What could break it

"Summary Risk Factors" (SEC filing, Feb 2026)

- Source: https://www.sec.gov/Archives/edgar/data/1389170/000119312526059296/trgp-20251231.htm (filed 2026-02-19); Summary Risk Factors

### What the price says

The price assumes cash profits grow 30.9% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); Ten-year compound average after fade. Initial solved rate 0.441754781919644. Price 282.55; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share -2.1343283582089554 → FY2025 2.2944798279028435. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $43.90 per share

- 2016-11: $53.29 per share

- 2016-12: $56.07 per share

- 2017-01: $57.62 per share

- 2017-02: $56.50 per share

- 2017-03: $59.90 per share

- 2017-04: $55.13 per share

- 2017-05: $45.93 per share

- 2017-06: $45.20 per share

- 2017-07: $46.41 per share

- 2017-08: $44.57 per share

- 2017-09: $47.30 per share

- 2017-10: $41.50 per share

- 2017-11: $43.40 per share

- 2017-12: $48.42 per share

- 2018-01: $48.00 per share

- 2018-02: $44.65 per share

- 2018-03: $44.00 per share

- 2018-04: $46.97 per share

- 2018-05: $48.63 per share

- 2018-06: $49.49 per share

- 2018-07: $51.07 per share

- 2018-08: $55.07 per share

- 2018-09: $56.31 per share

- 2018-10: $51.67 per share

- 2018-11: $44.63 per share

- 2018-12: $36.02 per share

- 2019-01: $43.01 per share

- 2019-02: $40.24 per share

- 2019-03: $41.55 per share

- 2019-04: $40.15 per share

- 2019-05: $38.46 per share

- 2019-06: $39.26 per share

- 2019-07: $38.91 per share

- 2019-08: $36.12 per share

- 2019-09: $40.17 per share

- 2019-10: $38.88 per share

- 2019-11: $36.53 per share

- 2019-12: $40.83 per share

- 2020-01: $36.50 per share

- 2020-02: $32.40 per share

- 2020-03: $6.91 per share

- 2020-04: $12.96 per share

- 2020-05: $17.89 per share

- 2020-06: $20.07 per share

- 2020-07: $18.28 per share

- 2020-08: $17.01 per share

- 2020-09: $14.03 per share

- 2020-10: $16.05 per share

- 2020-11: $23.50 per share

- 2020-12: $26.38 per share

- 2021-01: $27.37 per share

- 2021-02: $30.93 per share

- 2021-03: $31.75 per share

- 2021-04: $34.69 per share

- 2021-05: $38.86 per share

- 2021-06: $44.45 per share

- 2021-07: $42.11 per share

- 2021-08: $43.92 per share

- 2021-09: $49.21 per share

- 2021-10: $54.67 per share

- 2021-11: $51.63 per share

- 2021-12: $52.24 per share

- 2022-01: $59.08 per share

- 2022-02: $65.37 per share

- 2022-03: $75.47 per share

- 2022-04: $73.41 per share

- 2022-05: $72.02 per share

- 2022-06: $59.67 per share

- 2022-07: $69.11 per share

- 2022-08: $68.23 per share

- 2022-09: $60.34 per share

- 2022-10: $68.37 per share

- 2022-11: $74.39 per share

- 2022-12: $73.50 per share

- 2023-01: $75.02 per share

- 2023-02: $74.10 per share

- 2023-03: $72.95 per share

- 2023-04: $75.53 per share

- 2023-05: $68.05 per share

- 2023-06: $76.10 per share

- 2023-07: $81.99 per share

- 2023-08: $86.25 per share

- 2023-09: $85.72 per share

- 2023-10: $83.61 per share

- 2023-11: $90.45 per share

- 2023-12: $86.87 per share

- 2024-01: $84.96 per share

- 2024-02: $98.24 per share

- 2024-03: $111.99 per share

- 2024-04: $114.06 per share

- 2024-05: $118.23 per share

- 2024-06: $128.78 per share

- 2024-07: $135.28 per share

- 2024-08: $146.90 per share

- 2024-09: $148.01 per share

- 2024-10: $166.96 per share

- 2024-11: $204.30 per share

- 2024-12: $178.50 per share

- 2025-01: $196.80 per share

- 2025-02: $201.72 per share

- 2025-03: $200.47 per share

- 2025-04: $170.90 per share

- 2025-05: $157.93 per share

- 2025-06: $174.08 per share

- 2025-07: $166.41 per share

- 2025-08: $167.76 per share

- 2025-09: $167.54 per share

- 2025-10: $154.04 per share

- 2025-11: $175.31 per share

- 2025-12: $184.50 per share

- 2026-01: $200.98 per share

- 2026-02: $235.80 per share

- 2026-03: $250.73 per share

- 2026-04: $260.08 per share

- 2026-05: $255.07 per share

- 2026-06: $268.14 per share

- 2026-07: $270.37 per share

- 2026-08: $293.65 per share

- 2026-09: $270.31 per share

- 2026-10: $293.04 per share

## Annual estimated value (USD per share)

- FY2017: low $0.58 per share, central $0.67 per share, high $0.77 per share

- FY2018: low $0.72 per share, central $0.81 per share, high $0.93 per share

- FY2024: low $6.26 per share, central $7.12 per share, high $8.27 per share

- FY2025: low $25.08 per share, central $28.54 per share, high $33.14 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:38:14.946Z where newer inputs omit a numeric field or fiscal period.

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/1389170/000119312526059296/trgp-20251231.htm); period 2025-12-31, filed 2026-02-19.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.