News Flash: Analysts Just Made A Notable Upgrade To Their Targa Resources Corp. (NYSE:TRGP) Forecasts

Shareholders in Targa Resources Corp. (NYSE:TRGP) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The revenue forecast for next year has experienced a facelift, with analysts now much more optimistic on its sales pipeline.

After this upgrade, Targa Resources' three analysts are now forecasting revenues of US$24b in 2023. This would be a notable 11% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to surge 442% to US$5.83. Previously, the analysts had been modelling revenues of US$21b and earnings per share (EPS) of US$5.86 in 2023. There's clearly been a surge in bullishness around the company's sales pipeline, even if there's no real change in earnings per share forecasts.

View our latest analysis for Targa Resources

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Targa Resources' revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 8.9% growth on an annualised basis. This is compared to a historical growth rate of 18% over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue shrink 6.5% per year. So it's clear that despite the slowdown in growth, Targa Resources is still expected to grow meaningfully faster than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. Fortunately, they also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Targa Resources.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Targa Resources analysts - going out to 2025, and you can see them free on our platform here.

We also provide an overview of the Targa Resources Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.