Core Viewpoint - Analysts expect Targa Resources, Inc. (TRGP) to report quarterly earnings of $1.91 per share, reflecting a year-over-year increase of 43.6%, with revenues projected at $4.85 billion, up 36.2% from the previous year [1]. Earnings Estimates - The consensus EPS estimate has been revised 2% higher over the last 30 days, indicating a collective reevaluation by analysts [1][2]. Key Metrics Forecast - Analysts predict 'Gathering and Processing - NGL sales per day' to reach 591.25 thousand barrels, an increase from 569.70 thousand barrels year-over-year [4]. - 'Gathering and Processing - Gross NGL production - Coastal' is expected to be 32.03 thousand barrels per day, down from 34.40 thousand barrels [4]. - 'Gathering and Processing - Condensate sales per day' is estimated at 19.31 thousand barrels, a decrease from 21.20 thousand barrels [5]. - 'Logistics and Marketing - NGL sales' are projected to be 1,093.79 thousand barrels per day, up from 1,018.40 thousand barrels in the same quarter last year [6]. - 'Logistics and Marketing - Export volumes' are expected to reach 443.45 thousand barrels per day, compared to 394.10 thousand barrels year-over-year [6]. - 'Logistics and Marketing - Fractionation volumes' are forecasted at 1,106.38 thousand barrels per day, up from 902.20 thousand barrels [7]. - 'Gathering and Processing - Total Gross NGL production' is estimated at 990.94 thousand barrels per day, compared to 965.70 thousand barrels in the same quarter last year [8]. - The average realized price for 'Gathering and Processing - Average realized prices - Condensate' is projected at $62.47, down from $72.83 year-over-year [8]. Stock Performance - Targa Resources shares have shown a return of -6.1% over the past month, contrasting with the Zacks S&P 500 composite's +0.6% change [10].

Group 1 - Natural gas producers and transportation stocks have significantly declined, following a drop in U.S. natural gas futures, erasing most of last week's gains due to cooler weather forecasts and high production levels near 107 billion cubic feet [1] - The number of natural gas drilling rigs in the U.S. increased by 9 to a total of 117, indicating plans for increased production, which may provide short-selling opportunities in the natural gas market [1] - The NYMEX August natural gas futures price fell sharply by 6.7% to $3.325 per million British thermal units, marking the lowest settlement price since July 11 [1] Group 2 - The four biggest decliners in the S&P 500 index were all from the natural gas energy sector, with EQT Energy down 9.5%, Expand Energy down 8.5%, Coterra Energy down 5.3%, and Targa Resources down 4.5% [2] - The significant drop in natural gas futures and related stocks is rare this year, especially following favorable policies for the oil and gas industry and the ongoing high temperatures driving demand [2] - Major tech companies like Google, Microsoft, and Amazon AWS are significantly increasing their demand for natural gas due to the construction of large data centers, which aligns with the global trend towards cleaner energy sources [2] Group 3 - The importance of natural gas resources, particularly liquefied natural gas (LNG), is increasing as countries seek cleaner energy alternatives to oil and coal, making it a core energy source for large AI data centers in the coming years [3]

Core Points - Targa Resources Corp. declared a quarterly cash dividend of $1.00 per common share for Q2 2025, equating to an annualized rate of $4.00 per share, payable on August 15, 2025, to shareholders of record as of July 31, 2025 [1] - The company will report its Q2 2025 financial results before market opens on August 7, 2025, followed by a live webcast at 11:00 a.m. Eastern Time to discuss these results [2][3] Company Overview - Targa Resources Corp. is a leading provider of midstream services and one of the largest independent infrastructure companies in North America, focusing on the efficient delivery of energy across the U.S. and globally [4] - The company operates a diversified portfolio of assets that connect natural gas and NGLs to domestic and international markets, catering to the growing demand for cleaner fuels [4] - Targa is engaged in various activities including gathering, compressing, treating, processing, transporting, and selling natural gas, as well as handling NGLs and crude oil [4]

Targa's Value Proposition and Growth - Targa is the largest gatherer and processor in the Permian Basin, driving integrated returns through NGL pipeline transportation, fractionation, and LPG exports[9] - The company has experienced significant volume growth, with a +24% CAGR in fractionation volumes and +12% CAGR in LPG export volumes from FY 2019 to YTD 3Q24[12] - Permian natural gas inlet volumes have grown at a +25% CAGR from Q4 2019 to YTD 3Q24[16] - Targa's adjusted EBITDA has grown by +182% since 2019, driven by its integrated NGL business and strong business fundamentals[19] Financial Performance and Shareholder Returns - Management expects to recommend to Targa's Board of Directors an increase to the 2025 quarterly cash common dividend to $4.00 per share annualized for the first quarter of 2025, representing a +33% YoY increase[9, 10] - Targa has repurchased over 202 million shares since October 2020 at a weighted average price of ~$7069[19] - The company's 2024E fee-based volumes in G&P are approximately ~90%[9, 66] - Targa expects to return 40-50% of adjusted cash flow from operations across a multi-year horizon[75] Permian Basin and Infrastructure - Targa has a premier Permian asset footprint with ~88 Bcf/d gross processing capacity across 43 plants[26, 27, 80] - The company is expanding its Permian G&P footprint, with several new plants scheduled to come online between 1Q25 and 3Q26[32, 94] - Targa's Daytona NGL Pipeline has a capacity of 400 MBbl/d and was expected to be in service in 3Q24[95]

Core Insights - Targa Resources Corp. (TRGP) has experienced a significant share price increase of 43.9% over the past year, outperforming the broader Oils-Energy sector's 7.2% rise and the Oil Refining & Marketing sub-industry's 28% growth [1][8] - The company is strategically positioned in the energy infrastructure sector, focusing on natural gas operations, including gathering, processing, and transportation [3][4] Financial Performance - TRGP reported a record adjusted EBITDA of $1.18 billion in Q1 2025, reflecting a 22% year-over-year increase, driven by higher volumes from the Permian Basin and improved marketing margins [5][8] - The company has reaffirmed its full-year 2025 adjusted EBITDA guidance of $4.65-$4.85 billion, indicating confidence in sustained growth [5] Strategic Advantages - Targa's operations are supported by fee-based contracts, providing stability in volatile commodity price environments, with a competitive edge due to its scale [6] - The company has a dominant presence in the Permian Basin, with natural gas inlet volumes increasing by 11% year over year, and is expanding its infrastructure to enhance capacity [9][10] Growth Initiatives - Targa's LPG export volumes averaged 13.4 million barrels per month in Q1 2025, with plans to expand capacity at the Galena Park terminal to 19 million barrels per month by Q3 2027 [11] - The company is executing $2.6-$2.8 billion in growth capital expenditures for 2025, focusing on high-return projects to support volume growth and system integration [15] Shareholder Returns - Targa has repurchased $214 million in shares through April 2025 and increased its quarterly dividend by 33% to $1 per share, reflecting a commitment to rewarding shareholders [13] Risk Mitigation - The company has hedged over 90% of its exposed volumes through 2026, reducing earnings volatility from fluctuating natural gas and NGL prices, ensuring stable cash flows [14]

Company Overview - Targa Resources is a midstream energy company focused on gathering, processing, transporting, and marketing natural gas and natural gas liquids [1] - The company is primarily based in the Permian basin and other shale plays in the USA [1] Investment Focus - The company targets long-term and medium-term value investments [1] - It emphasizes investing in companies with strong fundamentals and maintains a sector-agnostic approach [1]

Core Insights - Targa Resources (NYSE: TRGP) has seen a significant share price increase of 40% recently, but has underperformed in the last two months, remaining flat while the broader market has recovered from early April losses [1] Company Performance - Targa Resources' shares have not followed the upward trend of the pipeline sector, indicating a potential divergence in performance compared to its peers [1] Market Context - The broader market has regained its losses from early April, contrasting with Targa's stagnant performance over the past two months, suggesting specific challenges or market perceptions affecting the company [1]

Core Viewpoint - Targa Resources Corp. is conducting a public offering of $750 million in Senior Notes due 2030 and $750 million in Senior Notes due 2036 to manage its debt and support corporate activities [1][2]. Group 1: Offering Details - The public offering includes $750 million of 4.900% Senior Notes due 2030 priced at 99.870% of face value and $750 million of 5.650% Senior Notes due 2036 priced at 99.700% of face value [1]. - The expected closing date for the offering is June 18, 2025, pending customary closing conditions [1]. Group 2: Use of Proceeds - A portion of the net proceeds will be used to redeem the 6.500% Senior Notes due 2027 [2]. - Remaining proceeds will be allocated for general corporate purposes, including repaying borrowings under the unsecured commercial paper note program, repaying other debts, repurchasing or redeeming securities, and funding capital expenditures or investments in subsidiaries [2]. Group 3: Company Overview - Targa Resources Corp. is a leading provider of midstream services and one of the largest independent infrastructure companies in North America [4]. - The company operates a diversified portfolio of infrastructure assets critical for the delivery of energy across the U.S. and internationally, connecting natural gas and natural gas liquids to markets with growing demand [4].

Core Viewpoint - Targa Resources Corp. (TRGP) reported disappointing first-quarter 2025 results, with adjusted earnings per share of 91 cents, missing the Zacks Consensus Estimate of $2.04, primarily due to lower volumes in the Permian Basin and increased operating expenses [1][2]. Financial Performance - Total quarterly revenues were $4.6 billion, matching the prior-year quarter but missing the Zacks Consensus Estimate of $5.3 billion, attributed to lower commodity sales [2] - Adjusted EBITDA for the first quarter was $1.2 billion, an increase from $966.2 million in the prior-year period [2]. Dividend and Share Repurchase - Targa raised its quarterly cash dividend to $1 per common share, totaling approximately $217 million to be distributed on May 15, 2025 [3]. - The company repurchased 651,163 shares for about $124.9 million at an average price of $191.86 per share, with $890.5 million remaining in its share repurchase program as of March 31, 2025 [4]. Operational Updates - Ongoing projects include construction at several plants in the Permian Basin, with the Pembrook II plant expected to begin operations by the third quarter of 2025 [5][6]. - The Gathering and Processing segment reported an operating margin of $602.2 million, up 8% year over year but below the consensus estimate [6][7]. - The Logistics and Transportation segment's operating margin increased 22% year over year to $646.7 million, also missing the consensus estimate [8]. Volume and Cost Analysis - Gathering and Processing volumes increased 11.3% year over year to an average of 6,006 MMcf/d, but fell short of the consensus mark [7]. - Fractionation volumes rose 23% year over year to 979.9 thousand barrels per day, while NGL pipeline transportation volumes increased 18% [9]. - Product costs were $3.3 billion, up 1% year over year, and operating expenses rose 9% to $303.6 million [11]. Capital Expenditures and Guidance - Targa's growth capital expenditures for 2025 are projected between $2.6 billion and $2.8 billion, with maintenance capital expenditures at $250 million [14]. - The company anticipates full-year adjusted EBITDA of $4.65-$4.85 billion, expecting significant growth in the second half of 2025 [13].

Financial Performance - Targa Resources, Inc. reported revenue of $4.56 billion for the quarter ended March 2025, which is unchanged compared to the same period last year [1] - Earnings per share (EPS) for the quarter was $0.91, down from $1.22 in the year-ago quarter [1] - The reported revenue fell short of the Zacks Consensus Estimate of $5.31 billion, resulting in a surprise of -14.12% [1] - The company experienced an EPS surprise of -55.39%, with the consensus EPS estimate being $2.04 [1] Stock Performance - Targa Resources shares have returned -16.9% over the past month, compared to the Zacks S&P 500 composite's -0.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3] Key Metrics - Gathering and Processing - NGL sales per day were 570.2 million barrels of oil, below the two-analyst average estimate of 577.97 million barrels [4] - Gathering and Processing - Gross NGL production (Coastal) was 32.7 million barrels of oil per day, exceeding the two-analyst average estimate of 31.89 million barrels [4] - Gathering and Processing - Condensate sales per day were 18.1 million barrels of oil, lower than the estimated 20.5 million barrels [4] - Logistics and Marketing - NGL sales were 1186.4 million barrels of oil per day, slightly below the estimated 1198.95 million barrels [4] - Logistics and Marketing - Export volumes were 447.7 million barrels of oil per day, compared to the estimated 455.64 million barrels [4] - Gathering and Processing - Total Plant natural gas inlet volumes were 7526.3 million cubic feet per day, below the estimated 7667.93 million cubic feet [4] - Average realized prices for Condensate were $72.32, slightly below the estimated $73.57 [4] - Average realized prices for Natural gas were $2.24, compared to the estimated $2.45 [4] - Average realized prices for NGL were $0.50, slightly below the estimated $0.51 [4]