TARGA RESOURCES CORP (TRGP) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TRGP - US87612G1013 - Common Stock
184.5 USD
-1.14 (-0.61%)
184.5 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to TRGP. TRGP was compared to 209 industry peers in the Oil, Gas & Consumable Fuels industry. While TRGP is still in line with the averages on profitability rating, there are concerns on its financial health. TRGP is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year TRGP was profitable.
In the past year TRGP had a positive cash flow from operations.
In multiple years TRGP reported negative net income over the last 5 years.
TRGP had a positive operating cash flow in each of the past 5 years.
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 better Return On Invested Capital (11.84%) than 88.52% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TRGP is significantly below the industry average of 21.27%.
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
The Profit Margin of TRGP (9.30%) is comparable to the rest of the industry.
TRGP has a Operating Margin of 17.92%. This is comparable to the rest of the industry: TRGP outperforms 53.11% of its industry peers.
In the last couple of years the Operating Margin of TRGP has grown nicely.
The Gross Margin of TRGP (36.00%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of TRGP has grown nicely.
| 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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TRGP is still creating some value.
The number of shares outstanding for TRGP has been reduced compared to 1 year ago.
The number of shares outstanding for TRGP has been reduced compared to 5 years ago.
TRGP has a better debt/assets ratio than last year.
2.2 Solvency
TRGP has an Altman-Z score of 2.33. 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 2.33 is fine compared to the rest of the industry. TRGP outperforms 73.68% of its industry peers.
The Debt to FCF ratio of TRGP is 27.12, which is on the high side as it means it would take TRGP, 27.12 years of fcf income to pay off all of its debts.
TRGP has a Debt to FCF ratio (27.12) which is comparable to the rest of the industry.
A Debt/Equity ratio of 6.19 is on the high side and indicates that TRGP has dependencies on debt financing.
TRGP has a worse Debt to Equity ratio (6.19) than 89.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.19 | ||
| Debt/FCF | 27.12 | ||
| Altman-Z | 2.33 |
ROIC/WACC1.44
WACC8.2%
2.3 Liquidity
TRGP has a Current Ratio of 0.77. This is a bad value and indicates that TRGP is not financially healthy enough and could expect problems in meeting its short term obligations.
TRGP has a worse Current ratio (0.77) than 68.42% of its industry peers.
A Quick Ratio of 0.61 indicates that TRGP may have some problems paying its short term obligations.
TRGP's Quick ratio of 0.61 is on the low side compared to the rest of the industry. TRGP is outperformed by 69.38% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.77 | ||
| Quick Ratio | 0.61 |
3. Growth
3.1 Past
TRGP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 33.99%, which is quite impressive.
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.
The Revenue has been growing by 13.57% on average over the past years. This is quite good.
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
TRGP is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.08% yearly.
TRGP is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.18% yearly.
EPS Next Y49.02%
EPS Next 2Y31.78%
EPS Next 3Y26.23%
EPS Next 5Y16.08%
Revenue Next Year3.41%
Revenue Next 2Y15.92%
Revenue Next 3Y11.97%
Revenue Next 5Y6.18%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 24.80, the valuation of TRGP can be described as rather expensive.
The rest of the industry has a similar Price/Earnings ratio as TRGP.
The average S&P500 Price/Earnings ratio is at 26.51. TRGP is around the same levels.
A Price/Forward Earnings ratio of 18.46 indicates a rather expensive valuation of TRGP.
The rest of the industry has a similar Price/Forward Earnings ratio as TRGP.
The average S&P500 Price/Forward Earnings ratio is at 23.13. TRGP is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.8 | ||
| Fwd PE | 18.46 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TRGP indicates a slightly more expensive valuation: TRGP is more expensive than 63.16% of the companies listed in the same industry.
TRGP's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 61.61 | ||
| EV/EBITDA | 12.33 |
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 26.23% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.51
PEG (5Y)N/A
EPS Next 2Y31.78%
EPS Next 3Y26.23%
5. Dividend
5.1 Amount
TRGP has a Yearly Dividend Yield of 2.18%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.93, TRGP has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.00, TRGP has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.18% |
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
47.51% of the earnings are spent on dividend by TRGP. This is a bit on the high side, but may be sustainable.
DP47.51%
EPS Next 2Y31.78%
EPS Next 3Y26.23%
184.5
-1.14 (-0.61%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners94.31%
Inst Owner Change1.63%
Ins Owners1.31%
Ins Owner Change-1.52%
Market Cap39.60B
Revenue(TTM)17.38B
Net Income(TTM)1.62B
Analysts84.83
Price Target212.49 (15.17%)
Short Float %2.44%
Short Ratio3.29
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.18% |
Yearly Dividend2.8
Dividend Growth(5Y)-7.6%
DP47.51%
Div Incr Years3
Div Non Decr Years3
Ex-DateN/A
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)1.84%
PT rev (3m)1.48%
EPS NQ rev (1m)4.07%
EPS NQ rev (3m)7.25%
EPS NY rev (1m)1.68%
EPS NY rev (3m)3.87%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-5.82%
Revenue NY rev (1m)-6.7%
Revenue NY rev (3m)-8.47%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.8 | ||
| Fwd PE | 18.46 | ||
| P/S | 2.28 | ||
| P/FCF | 61.61 | ||
| P/OCF | 10.59 | ||
| P/B | 14.63 | ||
| P/tB | 40.67 | ||
| EV/EBITDA | 12.33 |
EPS(TTM)7.44
EY4.03%
EPS(NY)9.99
Fwd EY5.42%
FCF(TTM)2.99
FCFY1.62%
OCF(TTM)17.42
OCFY9.44%
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 | 2.33 |
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 Y49.02%
EPS Next 2Y31.78%
EPS Next 3Y26.23%
EPS Next 5Y16.08%
Revenue 1Y (TTM)7.17%
Revenue growth 3Y-1.13%
Revenue growth 5Y13.57%
Sales Q2Q%7.77%
Revenue Next Year3.41%
Revenue Next 2Y15.92%
Revenue Next 3Y11.97%
Revenue Next 5Y6.18%
EBIT growth 1Y18.41%
EBIT growth 3Y26.58%
EBIT growth 5Y39.68%
EBIT Next Year71.74%
EBIT Next 3Y28.98%
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 for 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 are the PE and PB ratios of TARGA RESOURCES CORP (TRGP) stock?
The Price/Earnings (PE) ratio for TARGA RESOURCES CORP (TRGP) is 24.8 and the Price/Book (PB) ratio is 14.63.
What is the expected EPS growth for TARGA RESOURCES CORP (TRGP) stock?
The Earnings per Share (EPS) of TARGA RESOURCES CORP (TRGP) is expected to grow by 49.02% in the next year.