We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Targa Resources (TRGP) Surges 48.1% Since Q3 Earnings Beat
Read MoreHide Full Article
Shares of Targa Resources Corp. (TRGP - Free Report) have rallied 48.1% since third-quarter 2020 earnings announcement on Nov 5. Investors lauded the company’s upbeat quarterly performance. The stock appreciation is also attributable to the rising oil prices following successful data from two COVID-19 vaccine studies.
Targa Resources reported third-quarter 2020 adjusted net income per share of 16 cents, beating the Zacks Consensus Estimate of 9 cents. Moreover, the bottom line came against the year-ago loss of 34 cents per share. The outperformance was led by strong volumes across the company’s Permian gathering and processing systems.
The company’s adjusted EBITDA climbed from $349.6 million a year earlier to $419.1 million in the third quarter of 2020.
Moreover, total revenues of $2.12 billion were 11.1% higher than the year-ago quarter and also outpaced the Zacks Consensus Estimate of $1.9 billion.
Operational Performance
The Gathering and Processing segment recorded an operating margin of $261 million during the quarter, up 5.9% from $246.5 million achieved in the year-ago period. Permian Basin volumes increased 19.9% year over year to 2,569.6 million cubic feet per day.
In the Logistics and Transportation (or the Downstream) segment, the company reported operating margin of $280.4 million, up 22.5% year over year. Targa Resources saw fractionation volumes rise from 508.8 thousand barrels per day to 589.5, reflecting a 15.9% increase year over year. Moreover, export volumes expanded 29% year over year.
DCF, Capex & Balance Sheet
Third-quarter 2020 distributable cash flow (DCF) was $294.7 million, 28.2% higher than $229.9 million in the year-ago period. Targa Resources paid out a dividend of 10 cents per share.
As of Sep 30, 2020, the company had $275 million in cash and cash equivalents and $7.65 billion in long-term debt. Debt-to-capitalization was 55.2%.
Targa Resources, Inc. Price, Consensus and EPS Surprise
Targa Resources projects its growth capital spending guidance of approximately $700 million for 2020 and full-year maintenance capex of nearly $110 million.
With the upstream players starting to restore shut-in volumes in response to higher oil prices, Targa Resources foresees full-year adjusted EBITDA to be at or around the higher end of the prior guided range $1.5-$1.625 billion.
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
Image: Bigstock
Targa Resources (TRGP) Surges 48.1% Since Q3 Earnings Beat
Shares of Targa Resources Corp. (TRGP - Free Report) have rallied 48.1% since third-quarter 2020 earnings announcement on Nov 5. Investors lauded the company’s upbeat quarterly performance. The stock appreciation is also attributable to the rising oil prices following successful data from two COVID-19 vaccine studies.
Targa Resources reported third-quarter 2020 adjusted net income per share of 16 cents, beating the Zacks Consensus Estimate of 9 cents. Moreover, the bottom line came against the year-ago loss of 34 cents per share. The outperformance was led by strong volumes across the company’s Permian gathering and processing systems.
The company’s adjusted EBITDA climbed from $349.6 million a year earlier to $419.1 million in the third quarter of 2020.
Moreover, total revenues of $2.12 billion were 11.1% higher than the year-ago quarter and also outpaced the Zacks Consensus Estimate of $1.9 billion.
Operational Performance
The Gathering and Processing segment recorded an operating margin of $261 million during the quarter, up 5.9% from $246.5 million achieved in the year-ago period. Permian Basin volumes increased 19.9% year over year to 2,569.6 million cubic feet per day.
In the Logistics and Transportation (or the Downstream) segment, the company reported operating margin of $280.4 million, up 22.5% year over year. Targa Resources saw fractionation volumes rise from 508.8 thousand barrels per day to 589.5, reflecting a 15.9% increase year over year. Moreover, export volumes expanded 29% year over year.
DCF, Capex & Balance Sheet
Third-quarter 2020 distributable cash flow (DCF) was $294.7 million, 28.2% higher than $229.9 million in the year-ago period. Targa Resources paid out a dividend of 10 cents per share.
As of Sep 30, 2020, the company had $275 million in cash and cash equivalents and $7.65 billion in long-term debt. Debt-to-capitalization was 55.2%.
Targa Resources, Inc. Price, Consensus and EPS Surprise
Targa Resources, Inc. price-consensus-eps-surprise-chart | Targa Resources, Inc. Quote
Guidance
Targa Resources projects its growth capital spending guidance of approximately $700 million for 2020 and full-year maintenance capex of nearly $110 million.
With the upstream players starting to restore shut-in volumes in response to higher oil prices, Targa Resources foresees full-year adjusted EBITDA to be at or around the higher end of the prior guided range $1.5-$1.625 billion.
Zacks Rank & Key Picks
Targa Resources currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy space are CNOOC Limited (CEO - Free Report) , Antero Resources Corporation (AR - Free Report) and Noble Corporation (NE - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>