Update shared on20 Sep 2025
Fair value Decreased 1.02%Despite Targa Resources' resilient Permian volumes, robust cash flow prospects, and investor focus on capital returns, analysts modestly lowered price targets—now $205.30—citing sector-wide valuation concerns and near-term growth already reflected in the stock after a significant rally.
Analyst Commentary
- Bullish analysts cite Targa's strong positioning for natural gas, LNG, and natural gas liquid infrastructure expansion, underpinned by robust global power demand and high-quality asset selection.
- Multiple updates point to ongoing fundamental strength, including resilient Permian production volumes and long-term gas leverage, supporting cash flow confidence even amid commodity volatility and slowing basin-level growth.
- Several analysts highlight a shift in investor preferences toward midstream companies capable of reducing growth capex and prioritizing capital return via buybacks and increased dividends.
- Some targets were modestly lowered to reflect sector-wide adjustments, with concerns about “capex creep” and mixed Q2 earnings, yet overall forward outlooks remained largely intact.
- More cautious views reference valuation concerns following a substantial stock run-up in 2024, suggesting much of Targa’s near-term growth is already priced in.
What's in the News
- Reported higher NGL and natural gas inlet production for Q2 and year-to-date, while crude oil production declined in the Badlands and Permian.
- Actively seeking bolt-on acquisitions to complement existing G&P (gathering and processing) and NGL assets, though focus remains on organic growth.
- Announced a share repurchase program of up to $1 billion.
- Repurchased 2,606,262 shares (1.2% of shares outstanding) for $449.27 million as of June 30, 2025.
- Provided full-year 2025 net income guidance of $1,830 million.
Valuation Changes
Summary of Valuation Changes for Targa Resources
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from $207.42 to $205.30.
- The Consensus Revenue Growth forecasts for Targa Resources has fallen slightly from 11.4% per annum to 11.0% per annum.
- The Discount Rate for Targa Resources remained effectively unchanged, moving only marginally from 7.61% to 7.59%.
Disclaimer
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