Targa Resources Corp. (TRGP)

FairStock Score: 49/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look for businesses whose assets are hard to replace, bought at a sensible price. Targa owns midstream infrastructure—gathering, processing, transporting, fractionating natural gas and NGLs—which can enjoy local monopoly-like advantages once built. The latest filed quarter, fiscal Q2 2026 ended 2026-06-30, showed revenue of $4.4B, net income of $764.6M, and diluted EPS of $3.54. Compare that with fiscal Q2 2025, when revenue was $4.3B, net income $629.1M, and EPS $2.87. For fiscal year 2025, revenue was $17.0B, net income $1.9B, and EPS $8.49, up from fiscal year 2024 revenue of $14.1B, net income of $1.3B, and EPS of $5.74. Profit is clearly rising faster than revenue, and the Piotroski F-Score of 9/9 suggests improving fundamentals. But the balance sheet gives me pause: debt-to-equity is 5.16, Altman Z-Score 1.94, and ROCE is 9.24%. Free cash flow is $740.9M, only a 1.2% yield on the $62.8B market cap. At the 2026-10-13 close of $293.04, the P/E is 28.02, P/B is 20.06, and the Graham Number is $63.35, leaving a -362.57% margin of safety. The Lynch category is STALWART—steady growth: profit 128.0% a year over four years, revenue 1.4%. The FairStock Score is 46/100, and the PEG of 0.36 looks attractive, but Graham would not pay this price for a leveraged, low-FCF-yield midstream operator. Quality assets, demanding price.

In plain English: Targa moves and processes natural gas and natural gas liquids through pipelines, plants, and storage. The business is profitable and earnings have been rising, but it uses a lot of debt and does not generate much spare cash compared with its stock market value. At the recent price, the shares look expensive relative to the company’s accounting value and cash flow.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer