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    Does Stronger Q3 Commodity Sales And Fees Change The Bull Case For Targa Resources (TRGP)?

    Simply Wall St·12/11/2025 01:20:14
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    • In early November, Targa Resources reported past Q3 results showing growth in commodity sales and higher midstream service fees, even though earnings did not fully align with analyst expectations.
    • This combination of revenue drivers, alongside analysts maintaining a Strong Buy consensus and projecting higher long-term earnings, has sharpened attention on Targa’s midstream fee resilience and growth potential.
    • We’ll now examine how this stronger Q3 performance in commodity sales and midstream service fees may reshape Targa Resources’ broader investment narrative.

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    Targa Resources Investment Narrative Recap

    To own Targa Resources, you need to believe in sustained demand for Permian and Gulf Coast midstream infrastructure and the value of fee-based contracts that can smooth commodity swings. The recent Q3 beat on commodity sales and higher midstream service fees, despite missing Street earnings expectations, reinforces the importance of fee resilience as a near term catalyst, while competitive and regulatory pressures in its core regions remain the main risks to watch.

    Among recent announcements, the November guidance for a higher 2026 common dividend of US$5.00 per share stands out alongside the Q3 results. Taken together with ongoing buybacks, this points to management’s confidence that growing throughput and export-focused assets can support rising cash returns, even as investors weigh the risk of midstream overbuild and potential pressure on future fee structures.

    Yet while higher dividends are welcome, investors should also be aware of how midstream overbuild and narrowing export margins could...

    Read the full narrative on Targa Resources (it's free!)

    Targa Resources' narrative projects $23.6 billion revenue and $2.4 billion earnings by 2028. This requires 11.4% yearly revenue growth and about a $0.9 billion earnings increase from $1.5 billion today.

    Uncover how Targa Resources' forecasts yield a $208.00 fair value, a 13% upside to its current price.

    Exploring Other Perspectives

    TRGP 1-Year Stock Price Chart
    TRGP 1-Year Stock Price Chart

    Five members of the Simply Wall St Community place Targa’s fair value between about US$129 and US$394 per share, showing how far opinions can stretch. Set this against the importance of midstream fee resilience highlighted in the latest Q3 update, and it becomes clear why exploring several viewpoints can sharpen your sense of the company’s longer term prospects.

    Explore 5 other fair value estimates on Targa Resources - why the stock might be worth over 2x more than the current price!

    Build Your Own Targa Resources Narrative

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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.