10-Q · May 7, 2026
Targa Resources Corp. reported Q1 2026 results with revenues of $4.09B and an EPS of $2.03, both below consensus estimates, driven by lower commodity prices despite strong volume growth. The company's adjusted EBITDA…
Earnings analysis · 10-Q
TRGP earnings analysis
Filed November 5, 2026 · Our reading of the company's report
The latest report
Targa delivered a strong third quarter, with revenue of $5,598.6 million and adjusted EBITDA of $1,504.3 million, up 18% year over year and well above the $4,842.1 million revenue consensus. However, adjusted free cash…
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Targa delivered a strong third quarter, with revenue of $5,598.6 million and adjusted EBITDA of $1,504.3 million, up 18% year over year and well above the $4,842.1 million revenue consensus. However, adjusted free cash flow was only $33.6 million amid approximately $5.0 billion of planned 2026 growth capital expenditures, while derivative liabilities increased to $272.5 million and variable-rate borrowings totaled $1,311.0 million. The report therefore combines strong operating momentum and a constructive EBITDA outlook with meaningful leverage, liquidity and commodity-risk concerns.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
What stood out
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Revenue materially beat consensus
Third-quarter revenue was $5,598.6 million, approximately $756.5 million above the $4,842.1 million consensus estimate and up from $4,146 million in Q3 2025.
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EBITDA and volumes improved
Third-quarter adjusted EBITDA increased 18% year over year to $1,504.3 million, supported by record Permian and NGL volumes.
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Positive EBITDA and dividend outlook
Management expects at least $6.0 billion of 2026 adjusted EBITDA and plans to recommend a $6.00-per-share annual dividend for 2027.
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Multi-year commodity hedging
Management has hedged a portion of commodity exposures through 2029, including natural gas, NGL, condensate and transportation-basis risks, to reduce cash-flow variability.
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Controls remained effective
Disclosure controls were assessed as effective as of September 30, 2026, and management reported no material changes in internal control over financial reporting during the quarter.
What to watch
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Derivative liability increased
The derivative portfolio moved from a net liability of $66.9 million at December 31, 2025 to $272.5 million at September 30, 2026. A hypothetical 10% commodity-price increase would produce a $477.9 million derivative fair-value impact, before considering offsets from hedged items.
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Variable-rate debt exposure
The company had $1,311.0 million of outstanding variable-rate borrowings and no interest-rate hedges as of September 30, 2026; a 100-basis-point rate increase would raise annual interest expense by $13.1 million.
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Customer concentration increased
Two customers each represented approximately 11% of consolidated revenue in both the three- and nine-month periods ended September 30, 2026, whereas no customer represented 10% or more in the comparable 2025 periods.
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Heavy capital spending limits cash flow
Adjusted free cash flow was only $33.6 million despite adjusted EBITDA of $1,504.3 million, while management expects approximately $5.0 billion of 2026 net growth capital expenditures and $250 million of net maintenance capital expenditures.
Management's outlook
The filing does not provide numeric revenue or EPS guidance. Management expects at least $6.0 billion of 2026 adjusted EBITDA, approximately $5.0 billion of net growth capital expenditures, and $250 million of net maintenance capital expenditures; the prior EBITDA outlook is not provided, so the change direction cannot be determined. Management also expects to recommend a 2027 annual dividend of $6.00 per share.
Earlier filings 4
10-K · February 19, 2026
Targa Resources Corp. reported solid financial performance for 2025, achieving a total revenue of $17.03 billion with a significant increase in net income attributable to shareholders of $1.85 billion. The company…
10-Q · November 5, 2025
Targa Resources Corp.'s Q3 2025 performance showed a decline in revenue and EPS compared to the previous quarter and year, reflecting challenges in the natural gas market despite growth in certain operational segments…
10-Q · August 7, 2025
Targa Resources Corp. reported a challenging second quarter for 2025, reflecting a revenue decline to $4.26 billion, down 6.6% from $4.56 billion in the previous quarter, despite a significant EPS increase to $2.87 from…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.