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Targa Resources Corp - $TRGP - Earnings Analysis: Record full year 2024 adjusted EBITDA of $4.1 billion, a 17% increase over 2023

By sagebytes in Business —

Business Model

Targa Resources Corp. generates revenue through sales of commodities and fees from midstream services. The Gathering and Processing segment derives revenue from gathering, processing, and sale of natural gas, crude oil, condensate, and NGLs. The Logistics and Transportation segment generates revenue from transporting, storing, fractionating, terminaling, and marketing NGLs and NGL products.

Revenue Sources

  • Sales of commodities (e.g., natural gas, NGLs, crude oil, condensate)
  • Fees from midstream services (gathering, processing, transportation, fractionation, etc.)

Income Statement Analysis

  • Total revenues increased by 4% primarily due to higher sales of commodities and fees from midstream services.
  • Operating expenses increased by 13% mainly due to higher maintenance and labor costs.
  • Net income attributable to Targa Resources Corp. increased by 17% due to higher operating income.

Capital Allocation

Targa intends to recommend an annual common dividend of $4.00 per share for 2025. The company repurchased $754.7 million of its common stock in 2024. Estimates 2025 net growth capital expenditures of $2.6 billion to $2.8 billion.

Management Commentary

2024 was a great year and we are continuing to build on our momentum.

Our 2024 results demonstrate our differentiated positioning with record volumes from the Permian significantly outperforming initial expectations driving record NGL transportation fractionation and export volumes that also exceeded expectations.

Overall Sentiment: Positive, reflecting strong performance and growth outlook.

Disclaimer: This report is for informational purposes only and not investment advice. The analysis is based on limited information and subject to change. Investing in securities involves risks, including potential loss of principal. Past performance doesn't guarantee future results. Always conduct your own research, understand the risks, and consult a financial professional before making investment decisions.