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TRGP, Targa Resources Inc.

Pipelines & Midstream capital-intensive Cyclical

Targa is a leading provider of midstream services and is one of the largest independent infrastructure companies in North America.

To provide these services, we operate in two primary segments: (i) Gathering and Processing, and (ii) Logistics and Transportation (also referred to as our Downstream Business).

Latest annual: FY2025 10-K

TRGP · Targa Resources Inc.

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$17.0B

+20.5% YoY · 20% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $16.7B 5-yr avg $16.1B

Gross margin 43% 5-yr avg 23%

Operating margin 22.9% 5-yr avg 14.4%

ROIC 13% 5-yr avg 12%

Owner-earnings margin 16% 5-yr avg 12%

Free cash flow margin 4% 5-yr avg 6%

Next report By 11/8 · the 10-Q for the quarter ended late September · due within 40 days of period end · has filed ~37 days after · the wire records it on arrival

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Cyclical. Margins collapse and recover repeatedly across the record; a single year, good or bad, misstates the through-cycle earning power.
What moves the needle: Gross margin has run about 22% and operating margin about 4.0% through the cycle, a thin spread that turns the result on volume and the cost of what it sells far more than on the price it sets. The margin is cyclical, swinging between −19% and 20% over the years, so the through-cycle figure carries more than any single year — and the balance sheet at the trough more than the peak. The cash cycle has run negative through the cycle (a median of −15 days): the operation is paid before it pays, so working capital releases cash as the business grows rather than tying it up. Read this kind of business on rate base and the allowed return. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median 5%, above 15% in 0 of 10 years). By owner earnings: roughly 8% of revenue reaches owners as cash, consistently, and customers and suppliers fund the business through negative working capital. Modest returns here are the design, not a verdict: a regulated utility's prices are set by commission, so the questions are the return the regulator allows, how fast the invested base it earns that return on is growing, and the health of the relationship with the commissions that decide both — all of which live in the 10-K, not the multiple.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMJun 2026
											Income statement
$6.7B	$8.8B	$10.5B	$7.4B	$6.9B	$16.1B	$19.8B	$13.5B	$14.1B	$17.0B	$16.7B	RevenueRevenue
$1.8B	$1.9B	$2.2B	—	$1.7B	$2.4B	$2.9B	$2.8B	$3.4B	$6.5B	$7.2B	Gross profitGross prof.
26%	22%	21%	—	25%	15%	15%	21%	24%	38%	43%	Gross marginGross mgn
3%	2%	2%	4%	4%	2%	2%	3%	3%	2%	3%	SG&A / revenueSG&A/rev
$56M	($122M)	$238M	$193M	($1.3B)	$865M	$1.7B	$2.6B	$2.7B	$3.3B	$3.8B	Operating incomeOp. inc.
0.8%	−1.4%	2.3%	2.6%	−19.0%	5.4%	8.7%	19.4%	19.1%	19.6%	22.9%	Operating marginOp. mgn
($260M)	($293M)	$66M	($47M)	($1.6B)	$437M	$1.7B	$1.9B	$1.9B	$2.5B	—	Pretax incomePretax
($187M)	$54M	$2M	($209M)	($1.6B)	$71M	$1.2B	$1.3B	$1.3B	$1.9B	$2.3B	Net incomeNet inc.
—	—	8%	—	—	3%	8%	19%	20%	21%	22%	Effective tax rateTax rate
											Cash flow & returns
$837M	$940M	$1.1B	$1.4B	$1.7B	$2.3B	$2.4B	$3.2B	$3.6B	$3.9B	$4.3B	Operating cash flowOp. cash
$758M	$810M	$816M	$972M	$865M	$871M	$1.1B	$1.3B	$1.4B	$1.5B	$1.7B	Depreciation & amortizationD&A
$237M	$34M	$270M	$567M	$2.4B	$1.3B	$32M	$474M	$852M	$410M	$289M	Working capital & otherWC & other
$562M	$1.3B	$3.1B	$2.9B	$952M	$505M	$1.3B	$2.4B	$3.0B	$3.3B	$3.5B	CapexCapex
8.4%	14.7%	29.7%	38.9%	13.8%	3.1%	6.7%	17.6%	21.0%	19.6%	21.2%	Capex / revenueCapex/rev
$275M	$130M	$328M	$418M	$793M	$1.8B	$1.0B	$1.9B	$2.2B	$2.4B	$2.6B	Owner earningsOwner earn.
4.1%	1.5%	3.1%	5.7%	11.5%	11.2%	5.3%	13.9%	15.8%	14.1%	15.7%	Owner earnings marginOE mgn
$275M	($358M)	($2.0B)	($1.5B)	$793M	$1.8B	$1.0B	$826M	$684M	$584M	$741M	Free cash flowFCF
4.1%	−4.1%	−18.8%	−20.1%	11.5%	11.2%	5.3%	6.1%	4.8%	3.4%	4.4%	Free cash flow marginFCF mgn
—	$571M	—	—	—	—	$3.5B	—	—	$123M	$123M	AcquisitionsAcquis.
$566M	$843M	$908M	—	—	—	—	—	—	—	$950M	Dividends paidDiv. paid
($559M)	($1.9B)	($3.1B)	($3.1B)	($738M)	($473M)	($4.1B)	($2.4B)	($3.0B)	($3.6B)	—	Investing cash flowInv. cash
($346M)	$1.0B	$2.1B	$1.8B	($1.1B)	($1.9B)	$1.8B	($888M)	($613M)	($267M)	—	Financing cash flowFin. cash
($67M)	$64M	$95M	$99M	($88M)	($84M)	$61M	($77M)	$16M	$9M	—	Change in cashΔ cash
0%	-1%	1%	1%	-10%	8%	11%	13%	13%	13%	13%	ROICROIC
-4%	1%	0%	-4%	-59%	4%	45%	49%	51%	63%	62%	Return on equityROE
−14%	−13%	−15%	—	—	—	—	—	—	—	36%	Retained to equityRetained/eq
											Balance sheet
$74M	$137M	$232M	$331M	$243M	$159M	$219M	$142M	$157M	$166M	$132M	Cash & investmentsCash+inv
$675M	$828M	$866M	$855M	$863M	$1.3B	$1.4B	$1.5B	$1.6B	$1.5B	$2.0B	ReceivablesReceiv.
$138M	$205M	$165M	$162M	$182M	$153M	$394M	$372M	$334M	$429M	$312M	InventoryInvent.
$844M	$1.2B	$1.7B	$955M	$834M	$1.4B	$1.4B	$1.6B	$2.0B	$1.9B	$2.1B	Accounts payablePayables
($31M)	($155M)	($707M)	$62M	$211M	$83M	$353M	$268M	($60M)	$31M	$155M	Operating working capitalOper. WC
$1.0B	$1.3B	$1.4B	$1.7B	$1.5B	$1.8B	$2.4B	$2.2B	$2.3B	$2.4B	$2.6B	Current assetsCur. assets
$1.2B	$1.6B	$2.8B	$1.9B	$1.8B	$2.3B	$3.1B	$2.8B	$3.2B	$3.5B	$3.4B	Current liabilitiesCur. liab.
0.9×	0.8×	0.5×	0.9×	0.8×	0.8×	0.8×	0.8×	0.7×	0.7×	0.8×	Current ratioCurr. ratio
$9.7B	$10.4B	$12.9B	$14.5B	$12.2B	$11.7B	$14.2B	$15.8B	$18.1B	$20.5B	—	Net PP&ENet PP&E
$210M	$257M	$47M	$45M	$45M	$45M	$45M	$45M	$45M	$112M	$119M	GoodwillGoodwill
$12.9B	$14.4B	$16.9B	$18.8B	$15.9B	$15.2B	$19.6B	$20.7B	$22.7B	$25.2B	$28.5B	Total assetsAssets
$4.6B	$5.1B	$6.7B	$8.2B	$8.1B	$6.7B	$11.5B	$13.0B	$14.2B	$17.4B	$19.6B	Total debtDebt
$4.5B	$4.9B	$6.4B	$7.9B	$7.9B	$6.6B	$11.3B	$12.8B	$14.0B	$17.3B	$19.4B	Net debt / (cash)Net debt
$476M	$596M	$1.4B	$3.5B	$3.2B	$3.2B	$2.3B	$1.9B	$1.8B	$130M	—	Noncontrolling interestsNCI
$5.2B	$6.2B	$6.1B	$4.9B	$2.7B	$2.0B	$2.7B	$2.7B	$2.6B	$3.1B	$3.7B	Shareholders’ equityEquity
0.4%	0.5%	0.5%	0.8%	1.0%	0.4%	0.3%	0.5%	0.4%	0.4%	0.5%	Stock comp / revenueSBC/rev
											Per share
154M	207M	224M	233M	232M	229M	231M	226M	221M	217M	215M	Shares out (diluted)Shares
$43.33	$42.60	$46.76	$31.82	$29.60	$70.40	$85.77	$59.83	$63.88	$78.51	$77.76	Revenue / shareRev/sh
$-1.21	$0.26	$0.01	$-0.90	$-6.69	$0.31	$5.17	$5.96	$5.93	$8.87	$10.53	EPS (diluted)EPS
$1.78	$0.63	$1.46	$1.80	$3.41	$7.86	$4.53	$8.33	$10.06	$11.07	$12.23	Owner earnings / shareOE/sh
$1.78	$-1.73	$-8.79	$-6.40	$3.41	$7.86	$4.53	$3.66	$3.09	$2.69	$3.44	Free cash flow / shareFCF/sh
$3.67	$4.08	$4.05	—	—	—	—	—	—	—	$4.41	Dividends / shareDiv/sh
$3.64	$6.27	$13.89	$12.38	$4.10	$2.21	$5.77	$10.55	$13.40	$15.37	$16.46	Cap. spending / shareCapex/sh
$33.99	$29.77	$27.12	$21.16	$11.43	$8.80	$11.53	$12.12	$11.71	$14.14	$16.98	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+6.8%/yr	+21.5%/yr
Owner earnings / share	+22.5%/yr	+26.5%/yr
Dividends / share	+5.1%/yr (2-yr)	+5.1%/yr (2-yr)
Capital spending / share	+17.4%/yr	+30.3%/yr
Book value / share	−9.3%/yr	+4.4%/yr

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business earned $2.4B of owner earnings, the operating cash left after the $1.5B it takes just to hold its position. It put $1.8B more into growth; free cash flow, after that spending, was $584M.

Reported net income$1.9B

Owner earnings$2.4B · 14% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$1.9B	$1.3B	$1.3B	$1.2B	$71M
Depreciation & amortizationnon-cash charge added back	+$1.5B	+$1.4B	+$1.3B	+$1.1B	+$871M
Stock-based compensationreal costnon-cash, but a real cost	+$70M	+$63M	+$62M	+$58M	+$59M
Working capital & othertiming of cash in and out, other non-cash items	+$410M	+$852M	+$474M	+$32M	+$1.3B
Cash from operations	$3.9B	$3.6B	$3.2B	$2.4B	$2.3B
Maintenance capital expenditurethe spending needed just to hold position and volume	−$1.5B	−$1.4B	−$1.3B	−$1.3B	−$505M
Owner earnings	$2.4B	$2.2B	$1.9B	$1.0B	$1.8B
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	−$1.8B	−$1.5B	−$1.1B	—	—
Free cash flow	$584M	$684M	$826M	$1.0B	$1.8B
Owner-earnings marginowner earnings ÷ revenue	14%	16%	14%	5%	11%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the maintenance capital it must spend to hold its position (here about $1.5B, roughly its depreciation, the rate its assets wear out). The other $1.8B of its capital spending is growth it chose, not upkeep it owed; charged only with the maintenance it must do, the business earns well more than the year's free cash flow shows. The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $70M), owner earnings is nearer $2.3B.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? —

Interest expense not tagged in the data

What this means
No usable interest-expense line was tagged in the filing data, but the balance sheet carries real net debt — so the interest burden here is unknown, not absent. Read the debt on the net-debt check below.
How heavy is the debt, net of cash? $17.4B · 5.2× operating profit

Heavy net debt

Cash $166M − debt $17.6B

What this means
Netting $166M of cash and short-term investments against $17.6B of debt leaves $17.4B owed, about 5.2× a year's operating profit (5.3× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? -19d

Negative, funded by others

DSO 32 + DIO 15 − DPO 65 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. A negative cycle is a quiet moat: suppliers and customers fund the operation (Buffett's “float”), the company grows on other people's money.

Is it a good business?

Return on invested capital 5%

Below average through the cycle

10-yr median, range -10%–13%; 13% latest = NOPAT $2.6B ÷ invested capital $20.5B

Industry peers: median 11%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 10 years (it ran 13% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 8%

Solid through the cycle

10-yr median margin, range 1%–16%; latest $2.4B = operating cash $3.9B − maintenance capex $1.5B

Industry peers: median 13%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 14% of revenue this year, a 8% median across 10 years. It chose to put $1.8B more into growth, so free cash flow this year was $584M — the gap is investment, not weakness. Treating stock comp as the real expense it is (less $70M of SBC) leaves $2.3B.
Are earnings backed by cash? 2.04×

Cash-backed

Cash from ops $3.9B ÷ net income $1.9B

In the filing’s words The filing leans on adjusted, non-GAAP earnings, but the GAAP profit is itself cash-backed — the adjustments are not papering over a cash shortfall here.

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? —

Not enough data

What this means
The filing data didn't include the inputs for this check.
Investing or harvesting? 2.20×

Expanding

Capex $3.3B ÷ depreciation & amortization as filed $1.5B

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

The promise and the pay packet

Is the buyback buying ownership, or mopping up? 0.4%

The count is genuinely shrinking

Stock compensation $70M (fiscal 2025), 0.4% of revenue · no repurchases · diluted shares -6.1% since 2022

What this means
Stock handed to employees is a real cost paid in the owner's own currency: it is charged against profit, but the shares it creates are permanent. Many companies repurchase stock at the same time, which looks like a return of capital and often is not — if the count barely moves, the cash merely cancelled the pay packet and bought the owner nothing. The three states worth telling apart are a count genuinely shrinking, a count standing still despite large repurchases, and a count rising because the issuance was never offset at all.

Graham’s defensive tests · 1 of 4 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $17.0B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity —

Current ratio ≥ 2× (waived for utilities) · exempt

What this means
Graham exempted public utilities from this test: their working capital “takes care of itself” through the continuous bond-and-share financing of growth, so a thin current ratio is the industry's structure, not a warning. His substitute test — debt no more than twice book equity — is the next line.
Conservative debt Miss

Debt ≤ 2× equity (Graham's utility test) · $17.6B vs $3.1B equity

What this means
Graham's own substitution for public utilities: debt not exceeding twice the stock equity at book value, in place of the working-capital tests an industrial faces. A utility finances its plant with bonds by design; the question is whether the borrowing stays inside the equity behind it.
Earnings stability Miss

A profit every year (10-yr record) · 3 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · 3 of 10 yrs

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth —

Earnings +33% over the record · —

What this means
Earnings were negative early in the record, a growth rate isn't meaningful.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $7.12/share (latest year $8.97), the averaged base the calculator's gate runs on, and book value is $14.31/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 7 of 10

What this means
Lost money in 3 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 0 of 10 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 1% → 19% (3-yr avg ends)

In the filing’s words The margin widened even though the filing names price competition — the gain came from volume or cost, not pricing power. Read where.

What this means
Through the cycle the operating margin widened — about 1% early to 19% lately, median 3% — pricing power intact or improving.
Reinvestment, incremental ROIC 35%

What this means
Every extra dollar the business reinvested came back at a high incremental return — the lens GBM read for a moat that reinvests rather than merely harvests. The record and the 10-K are where you check whether the rate holds.
Owner earnings growth +31%/yr

What this means
Owner earnings grew about 31% a year over the record.
Worst year 2020 · −19.0% op. margin

What this means
Operations went underwater in 2020, understand why before trusting the good years.
Share count +3.8%/yr

What this means
The share count is rising, dilution works against you on a per-share basis.
Dividend record rising

What this means
Paid and raised the dividend across the record, the continuity Graham prized.
How management talks about it Owner’s terms

What this means
The record and the register agree: capital is compounding and the filing reasons in an owner’s terms — per-share value, return on capital, the long term — not a promoter’s.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Jun 30, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$2.6B

Cash & short-term investments$132M
Receivables$2.0B
Inventory$312M
Other current assets$233M

Current liabilities$3.4B

Accounts payable$2.1B
Other current liabilities$1.3B

Current ratio0.77×all current assets ÷ what's due · Graham looked for 2×

Quick ratio0.68×stricter: inventory excluded

Cash ratio0.04×strictest: cash alone against what's due

Working capital($782M)the cushion left after near-term bills

Its current ratio is below 1, which usually reads as strain; here it is likely structural strength. This business collects from customers before it pays suppliers (a negative cash-conversion cycle), so the balance sheet is funded by that float, the way Costco's and Amazon's are. The low ratio can be the edge, not the risk; the cash-conversion cycle and the debt due above say which.

Revenue, latest quarter vs. a year ago+4.2%the freshest read on whether the business is still growing

Current ratio, recent quarters0.8× → 0.8×

Deeper floors

Tangible book value$1.4Bequity stripped of goodwill & intangibles

Debt incl. operating leases$19.7B$114M of it operating leases

Deferred revenue$116Mcustomer cash collected before delivery; operating float

From the company's latest filing.

How the cash was used, 2016–2025

Over the record, the business generated $21.5B of operating cash; how management split it reads as a reinvestor, most operating cash is plowed back into the business.

Reinvested$19.3B · 90%
Dividends$2.3B · 11%

Returned to owners$2.3B
21% of the owner earnings the business produced over the span, $2.3B as dividends and $0 as buybacks.
Source of fundingOperating cash
Operating cash covered reinvestment and returns; over the span debt rose $15.0B and cash and short-term investments rose $59M.
Net change in share count39.4%
The diluted count rose from 154M to 215M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
Dividend record$4.05/sh
Paid in 3 of the years on record, the per-share dividend growing about 5% a year. It was never cut over the span.
Return on what it retained118%
Of the earnings it kept rather than paid out ($1.6B over the span), annual owner earnings (first three years vs last three) grew $1.9B, so each retained $1 added about 1.18 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$1.8B7% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity4%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$6.9Bover 9 years since fiscal 2010 buying other businesses, against $19.3B of capital spent building over the 10-year record

$417M written down across 2 years (2016, 2018): goodwill the company has already conceded it overpaid for, charged against earnings. A write-down costs no cash (the cash went out when the deal was signed), but it is management marking its own past judgment to market.

Beside that spending sits $2.5B of cumulative amortization of acquired intangibles charged against earnings since fiscal 2013 — the purchase price of past deals, expensed over time.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and amortization summed across the company's full tagged history, write-downs across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	Matthew J. Meloy	$14.7M	$40.3M	$1.8B
2022	Matthew J. Meloy	$15.2M	$39.2M	$1.0B
2023	Matthew J. Meloy	$14.2M	$28.6M	$1.9B
2024	Matthew J. Meloy	$15.5M	$77.3M	$2.2B
2025	Matthew J. Meloy	$21.5M	$31.0M	$2.4B

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership1.4%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio145:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$70M
The slice of the business handed to employees in shares in fiscal 2025, 0.4% of revenue, equal to 2.1% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Peers, Pipelines & Midstream

The same industry, side by side on owner economics. Each column names the period it is read over, and a median resting on fewer than three years carries that count beside it; the group median at the foot is the line to read each figure against.

Company	Revenuelatest FY, USD	Gross marginmedian over the record	Op. marginmedian over the record	ROICmedian over the record	Owner earn. marginmedian over the record
ETEnergy Transfer LP Common	$85.5B	25%	10.3%	9%	8%
EPDEnterprise Products Partners L.P.	$52.6B	27%	14.4%	12%	12%
OKEONEOK Inc.	$33.6B	29%	15.8%	8%	13%
LNGCheniere Energy Inc.	$20.0B	44%3y	25.1%	19%	17%
TRGPTarga Resources Inc.	$17.0B	22%	4.0%	5%	8%
TRPTC Energy Corporation	$11.0B	93%	42.9%	7%3y	-9%
CQPCheniere Energy Partners LP Common	$10.8B	47%3y	30.3%	11%	20%
WESWestern Midstream Partners LP Common	$3.8B	73%3y	43.1%	13%	38%
Group median	—	37%	20.4%	10%	13%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Targa Resources Inc. has delivered.

Targa Resources Inc.’s latest year runs above its own through-cycle margin — the reported figure may flatter a peak. So the tool opens on the through-cycle base, Graham’s averaging cutting both ways; clear the toggle below to read the latest year exactly as reported.

Today’s price $

Through the cycle, Targa Resources Inc. earns about $1.4B on its 8.4% median owner-earnings margin. This year’s 14.1% margin runs above that; the reported figure may flatter a peak you'd be paying on. Normalize, below, values the price on that through-cycle figure rather than the latest year. It comes pre-checked here for that reason, the same rule that already normalizes a trough; clear it to price the year as filed.

Base Normalize · through-cycle ($1.4B) Net of stock comp (−$76M TTM) Steady-state · maintenance capex ($2.8B)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.71% 10-year Treasury (Aug 18, 2026) + 4.29 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25+13%/yr

Owner-earnings growth · since FY2020−6%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.71%, as of Aug 18, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow $741M on 214M shares outstanding, per the 10-Q cover, as of 2026-07-31; net debt $19.4B. The base opens on the through-cycle figure (the latest year sits above the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. Capex ($3.5B) runs well above depreciation ($1.7B), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $2.8B, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh TRGP against another business →

Cite: Owner Scorecard, "Targa Resources Inc. (TRGP), the owner's record," https://ownerscorecard.com/c/TRGP, data as of 2026-08-17.

Manual order: ← TREX its page in the Manual TRIP →

Industry order: ← TGS the Pipelines & Midstream chapter TRP →