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Targa Resources Investments (NYSE:TRGP)

US87612G1013

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

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Targa Resources Investments stock research in summary

targaresources.com

ANALYSIS: With an Obermatt Combined Rank of 23 (worse than 77% compared with investment alternatives), Targa Resources Investments (Oil & Gas Transportation, USA) shares have lower financial characteristics compared with similar stocks. Shares of Targa Resources Investments are low in value (priced high) with a consolidated Value Rank of 9 (worse than 91% of alternatives), and are riskily financed (Safety Rank of 11, which means above-average debt burdens) but show above-average growth (Growth Rank of 93). ...read more

RECOMMENDATION: A Combined Rank of 23, is a sell recommendation based on Targa Resources Investments's financial characteristics. As the company Targa Resources Investments shows low value with an Obermatt Value Rank of 9 (91% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 93% of comparable companies (Obermatt Growth Rank is 93). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 11 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Targa Resources Investments, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	9
Growth Rank	93
Safety Rank	11
Combined Rank	23

Country	USA
Industry	Oil & Gas Transportation
Index
Size class	XX-Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Targa Resources Investments

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	24	9	14	9
GROWTH
GROWTH	61	29	95	93
SAFETY
SAFETY	43	75	8	11
SENTIMENT
SENTIMENT	n/a	53	100	^new
360° VIEW
360° VIEW	n/a	25	57	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Targa Resources Investments is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	24	9	14	9
GROWTH
GROWTH	61	29	95	93
SAFETY
SAFETY	43	75	8	11
COMBINED
COMBINED	27	19	21	23

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Targa Resources Investments the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 9 (worse than 91% compared with alternatives), Targa Resources Investments shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Targa Resources Investments. Price-to-Sales is 46 which means that the stock price compared with what market professionals expect for future profits is higher than 54% of comparable companies, indicating a low value concerning Targa Resources Investments's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 1, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Targa Resources Investments. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 14 and Dividend Yield, which is lower than 77% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 9, is a sell recommendation based on Targa Resources Investments's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Targa Resources Investments? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Targa Resources Investments? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Targa Resources Investments may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	86	74	79	46
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	34	7	20	14
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	1	5	1	1
DIVIDEND YIELD
DIVIDEND YIELD	35	33	34	23
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	24	9	14	9

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Targa Resources Investments; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 93 (better than 93% compared with alternatives) for 2024, Targa Resources Investments shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Targa Resources Investments. Sales Growth has a rank of 85 which means that currently, professionals expect the company to grow more than 85% of its competitors. Both Profit Growth, with a rank of 95, and Stock Returns, with a rank of 100, are also above average. But Capital Growth only has a rank of 4, which means that, currently, professionals expect the company to grow its invested capital less than 96% of its competitors. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 93, is a buy recommendation for growth and momentum investors. That may be a good sign if the company is already well positioned and doesn't require more investments at this time. They may focus on growing the top (revenues) and bottom (profits) lines, recently rewarded with above-average stock returns for shareholders. But it may also be a sign of danger as the company is falling back with capital investment activities concerning competition. This requires further analysis of corporate communications. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	87	45	89	85
PROFIT GROWTH
PROFIT GROWTH	50	40	92	95
CAPITAL GROWTH
CAPITAL GROWTH	n/a	8	25	4
STOCK RETURNS
STOCK RETURNS	81	73	85	100
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	61	29	95	93

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Targa Resources Investments.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 11 (better than 11% compared with alternatives), the company Targa Resources Investments has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Targa Resources Investments is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for Targa Resources Investments. Liquidity is at 34, meaning that the company generates less profit to service its debt than 66% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 8, meaning the company has an above-average debt-to-equity ratio. It has more debt than 92% of its competitors. Finally, Refinancing is at a rank of 37 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 63% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 11 (worse than 89% compared with alternatives), Targa Resources Investments has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing. Investors should look at Obermatt’s Value, Growth, and Sentiment Ranks to confirm a very positive outlook or be careful with investing in stocks of Targa Resources Investments because it may suffer significantly in case of future difficulties. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	46	43	10	8
REFINANCING
REFINANCING	21	37	30	37
LIQUIDITY
LIQUIDITY	63	100	23	34
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	43	75	8	11

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Targa Resources Investments and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	91	97	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	22	44	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	51	83	^new
MARKET PULSE
MARKET PULSE	n/a	26	85	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	53	100	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Targa Resources Investments.
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