TARGA RESOURCES CORP (TRGP) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TRGP - US87612G1013 - Common Stock
175.31 USD
+2.18 (+1.26%)
175.31 USD
0 (0%)
Overall TRGP gets a fundamental rating of 5 out of 10. We evaluated TRGP against 209 industry peers in the Oil, Gas & Consumable Fuels industry. There are concerns on the financial health of TRGP while its profitability can be described as average. TRGP has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year TRGP was profitable.
TRGP had a positive operating cash flow in the past year.
In multiple years TRGP reported negative net income over the last 5 years.
Each year in the past 5 years TRGP had a positive operating cash flow.
1.2 Ratios
TRGP's Return On Assets of 6.68% is fine compared to the rest of the industry. TRGP outperforms 76.08% of its industry peers.
Looking at the Return On Equity, with a value of 59.68%, TRGP belongs to the top of the industry, outperforming 95.69% of the companies in the same industry.
TRGP has a Return On Invested Capital of 11.84%. This is amongst the best in the industry. TRGP outperforms 87.56% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for TRGP is significantly below the industry average of 21.49%.
The 3 year average ROIC (10.47%) for TRGP is below the current ROIC(11.84%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.68% | ||
| ROE | 59.68% | ||
| ROIC | 11.84% |
ROA(3y)4.73%
ROA(5y)0.69%
ROE(3y)37.62%
ROE(5y)11.05%
ROIC(3y)10.47%
ROIC(5y)9.38%
1.3 Margins
Looking at the Profit Margin, with a value of 9.30%, TRGP is in line with its industry, outperforming 55.50% of the companies in the same industry.
TRGP has a Operating Margin of 17.92%. This is comparable to the rest of the industry: TRGP outperforms 52.15% of its industry peers.
In the last couple of years the Operating Margin of TRGP has grown nicely.
Looking at the Gross Margin, with a value of 36.00%, TRGP is in line with its industry, outperforming 45.93% of the companies in the same industry.
TRGP's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.92% | ||
| PM (TTM) | 9.3% | ||
| GM | 36% |
OM growth 3Y28.03%
OM growth 5Y22.99%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y22.2%
GM growth 5Y3.32%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), TRGP is creating some value.
The number of shares outstanding for TRGP has been reduced compared to 1 year ago.
TRGP has less shares outstanding than it did 5 years ago.
The debt/assets ratio for TRGP has been reduced compared to a year ago.
2.2 Solvency
TRGP has an Altman-Z score of 2.28. This is not the best score and indicates that TRGP is in the grey zone with still only limited risk for bankruptcy at the moment.
TRGP's Altman-Z score of 2.28 is fine compared to the rest of the industry. TRGP outperforms 70.81% of its industry peers.
TRGP has a debt to FCF ratio of 27.12. This is a negative value and a sign of low solvency as TRGP would need 27.12 years to pay back of all of its debts.
With a Debt to FCF ratio value of 27.12, TRGP perfoms like the industry average, outperforming 42.58% of the companies in the same industry.
A Debt/Equity ratio of 6.19 is on the high side and indicates that TRGP has dependencies on debt financing.
The Debt to Equity ratio of TRGP (6.19) is worse than 90.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.19 | ||
| Debt/FCF | 27.12 | ||
| Altman-Z | 2.28 |
ROIC/WACC1.44
WACC8.2%
2.3 Liquidity
A Current Ratio of 0.77 indicates that TRGP may have some problems paying its short term obligations.
With a Current ratio value of 0.77, TRGP is not doing good in the industry: 69.86% of the companies in the same industry are doing better.
A Quick Ratio of 0.61 indicates that TRGP may have some problems paying its short term obligations.
TRGP has a worse Quick ratio (0.61) than 71.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.77 | ||
| Quick Ratio | 0.61 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 33.99% over the past year.
TRGP shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 45.97% yearly.
Looking at the last year, TRGP shows a small growth in Revenue. The Revenue has grown by 7.17% in the last year.
Measured over the past years, TRGP shows a quite strong growth in Revenue. The Revenue has been growing by 13.57% on average per year.
EPS 1Y (TTM)33.99%
EPS 3Y45.97%
EPS 5YN/A
EPS Q2Q%26.07%
Revenue 1Y (TTM)7.17%
Revenue growth 3Y-1.13%
Revenue growth 5Y13.57%
Sales Q2Q%7.77%
3.2 Future
The Earnings Per Share is expected to grow by 16.08% on average over the next years. This is quite good.
The Revenue is expected to grow by 6.18% on average over the next years.
EPS Next Y46.56%
EPS Next 2Y30.24%
EPS Next 3Y25.42%
EPS Next 5Y16.08%
Revenue Next Year10.84%
Revenue Next 2Y15.41%
Revenue Next 3Y11.28%
Revenue Next 5Y6.18%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 23.56, the valuation of TRGP can be described as rather expensive.
TRGP's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of TRGP to the average of the S&P500 Index (26.31), we can say TRGP is valued inline with the index average.
The Price/Forward Earnings ratio is 17.96, which indicates a rather expensive current valuation of TRGP.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TRGP is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of TRGP to the average of the S&P500 Index (36.59), we can say TRGP is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.56 | ||
| Fwd PE | 17.96 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TRGP is valued a bit more expensive than 62.20% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TRGP is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 58.54 | ||
| EV/EBITDA | 11.9 |
4.3 Compensation for Growth
TRGP's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
TRGP has a very decent profitability rating, which may justify a higher PE ratio.
TRGP's earnings are expected to grow with 25.42% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.51
PEG (5Y)N/A
EPS Next 2Y30.24%
EPS Next 3Y25.42%
5. Dividend
5.1 Amount
TRGP has a Yearly Dividend Yield of 2.31%.
TRGP's Dividend Yield is comparable with the industry average which is at 5.93.
Compared to an average S&P500 Dividend Yield of 2.34, TRGP has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.31% |
5.2 History
The dividend of TRGP decreases each year by -7.60%.
TRGP has been paying a dividend for at least 10 years, so it has a reliable track record.
TRGP has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-7.6%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
TRGP pays out 47.51% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP47.51%
EPS Next 2Y30.24%
EPS Next 3Y25.42%
175.31
+2.18 (+1.26%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners93.16%
Inst Owner Change1.61%
Ins Owners1.39%
Ins Owner Change-1.39%
Market Cap37.63B
Revenue(TTM)17.38B
Net Income(TTM)1.62B
Analysts84.83
Price Target208.66 (19.02%)
Short Float %2.13%
Short Ratio2.87
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.31% |
Yearly Dividend2.8
Dividend Growth(5Y)-7.6%
DP47.51%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)26.87%
Min EPS beat(2)3.1%
Max EPS beat(2)50.64%
EPS beat(4)2
Avg EPS beat(4)-6.61%
Min EPS beat(4)-54.87%
Max EPS beat(4)50.64%
EPS beat(8)4
Avg EPS beat(8)-4.7%
EPS beat(12)5
Avg EPS beat(12)-11.96%
EPS beat(16)6
Avg EPS beat(16)-16.4%
Revenue beat(2)0
Avg Revenue beat(2)-12.24%
Min Revenue beat(2)-13.68%
Max Revenue beat(2)-10.8%
Revenue beat(4)0
Avg Revenue beat(4)-9.17%
Min Revenue beat(4)-13.68%
Max Revenue beat(4)-3.5%
Revenue beat(8)2
Avg Revenue beat(8)-6.69%
Revenue beat(12)2
Avg Revenue beat(12)-11.29%
Revenue beat(16)4
Avg Revenue beat(16)-8.59%
PT rev (1m)0.6%
PT rev (3m)-0.42%
EPS NQ rev (1m)2.36%
EPS NQ rev (3m)3.36%
EPS NY rev (1m)0.65%
EPS NY rev (3m)4.13%
Revenue NQ rev (1m)-2.61%
Revenue NQ rev (3m)-5.82%
Revenue NY rev (1m)-1.36%
Revenue NY rev (3m)-6.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.56 | ||
| Fwd PE | 17.96 | ||
| P/S | 2.17 | ||
| P/FCF | 58.54 | ||
| P/OCF | 10.06 | ||
| P/B | 13.9 | ||
| P/tB | 38.64 | ||
| EV/EBITDA | 11.9 |
EPS(TTM)7.44
EY4.24%
EPS(NY)9.76
Fwd EY5.57%
FCF(TTM)2.99
FCFY1.71%
OCF(TTM)17.42
OCFY9.94%
SpS80.96
BVpS12.61
TBVpS4.54
PEG (NY)0.51
PEG (5Y)N/A
Graham Number45.94
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.68% | ||
| ROE | 59.68% | ||
| ROCE | 14.67% | ||
| ROIC | 11.84% | ||
| ROICexc | 11.91% | ||
| ROICexgc | 12.98% | ||
| OM | 17.92% | ||
| PM (TTM) | 9.3% | ||
| GM | 36% | ||
| FCFM | 3.7% |
ROA(3y)4.73%
ROA(5y)0.69%
ROE(3y)37.62%
ROE(5y)11.05%
ROIC(3y)10.47%
ROIC(5y)9.38%
ROICexc(3y)10.57%
ROICexc(5y)9.49%
ROICexgc(3y)12.22%
ROICexgc(5y)10.81%
ROCE(3y)12.98%
ROCE(5y)11.62%
ROICexgc growth 3Y10.65%
ROICexgc growth 5Y35.31%
ROICexc growth 3Y10.05%
ROICexc growth 5Y35.4%
OM growth 3Y28.03%
OM growth 5Y22.99%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y22.2%
GM growth 5Y3.32%
F-Score7
Asset Turnover0.72
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.19 | ||
| Debt/FCF | 27.12 | ||
| Debt/EBITDA | 3.63 | ||
| Cap/Depr | 206.01% | ||
| Cap/Sales | 17.82% | ||
| Interest Coverage | 4.11 | ||
| Cash Conversion | 80.99% | ||
| Profit Quality | 39.79% | ||
| Current Ratio | 0.77 | ||
| Quick Ratio | 0.61 | ||
| Altman-Z | 2.28 |
F-Score7
WACC8.2%
ROIC/WACC1.44
Cap/Depr(3y)176.1%
Cap/Depr(5y)139.26%
Cap/Sales(3y)13.44%
Cap/Sales(5y)10.96%
Profit Quality(3y)82.47%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)33.99%
EPS 3Y45.97%
EPS 5YN/A
EPS Q2Q%26.07%
EPS Next Y46.56%
EPS Next 2Y30.24%
EPS Next 3Y25.42%
EPS Next 5Y16.08%
Revenue 1Y (TTM)7.17%
Revenue growth 3Y-1.13%
Revenue growth 5Y13.57%
Sales Q2Q%7.77%
Revenue Next Year10.84%
Revenue Next 2Y15.41%
Revenue Next 3Y11.28%
Revenue Next 5Y6.18%
EBIT growth 1Y18.41%
EBIT growth 3Y26.58%
EBIT growth 5Y39.68%
EBIT Next Year73.77%
EBIT Next 3Y27.6%
EBIT Next 5Y19.05%
FCF growth 1Y6.14%
FCF growth 3Y-27.54%
FCF growth 5YN/A
OCF growth 1Y33.98%
OCF growth 3Y16.59%
OCF growth 5Y21.3%
TARGA RESOURCES CORP / TRGP FAQ
Can you provide the ChartMill fundamental rating for TARGA RESOURCES CORP?
ChartMill assigns a fundamental rating of 5 / 10 to TRGP.
What is the valuation status of TARGA RESOURCES CORP (TRGP) stock?
ChartMill assigns a valuation rating of 4 / 10 to TARGA RESOURCES CORP (TRGP). This can be considered as Fairly Valued.
Can you provide the profitability details for TARGA RESOURCES CORP?
TARGA RESOURCES CORP (TRGP) has a profitability rating of 6 / 10.
What is the earnings growth outlook for TARGA RESOURCES CORP?
The Earnings per Share (EPS) of TARGA RESOURCES CORP (TRGP) is expected to grow by 46.56% in the next year.
Is the dividend of TARGA RESOURCES CORP sustainable?
The dividend rating of TARGA RESOURCES CORP (TRGP) is 4 / 10 and the dividend payout ratio is 47.51%.