Targa Resources (TRGP) has drawn fresh attention after signing new long-term, fee-based agreements with ExxonMobil subsidiaries in the Permian Basin, backed by 20-year acreage and NGL dedications.
See our latest analysis for Targa Resources.
The ExxonMobil agreements land at a time when Targa Resources’ share price has risen strongly over 2026, with a year to date share price return of 48.81% and a 1 year total shareholder return of 76.29%, pointing to strong momentum built over several years.
If you want to see how other energy infrastructure plays are shaping up alongside Targa’s latest move, it could be worth reviewing the 39 power grid technology and infrastructure stocks
Targa Resources now sits at the intersection of a sharp share price move and fresh 20 year ExxonMobil commitments. Is the current valuation mostly about sentiment, or does it still line up with the underlying cash generation story?
Most Popular Narrative: 6.5% Undervalued
Targa Resources last closed at $277.94, while the most followed narrative pegs fair value at about $297 per share, putting recent ExxonMobil contracts into a sharper pricing context.
Substantial investment in integrated export infrastructure, including the expansion and debottlenecking of LPG export facilities and new fractionation trains, directly leverages rising international and petrochemical sector demand for U.S. NGLs, creating long-term opportunities to enhance utilization and operating leverage, which should support higher earnings and margins.
Want to see what is baked into that fair value for Targa Resources? The narrative leans heavily on volume growth, export throughput and a richer profit profile. Curious which long term cash flow assumptions really carry the model.
Result: Fair Value of $297.29 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, the Targa Resources narrative still leans on bullish assumptions that could be tested if Permian competition erodes fees or if midstream overbuild pressures export margins.
Find out about the key risks to this Targa Resources narrative.
Another View on Targa Resources Valuation
The SWS DCF model presents a very different picture for Targa Resources. It suggests a future cash flow value of about $562.59 per share versus the current $277.94, which screens as undervalued and is far above the $297 fair value narrative. Which lens do you trust more for long term decisions?
Look into how the SWS DCF model arrives at its fair value.
Next Steps
If the mixed signals around Targa Resources leave you unsure, that is a useful starting point rather than a problem. Move quickly from headlines to hard data, then weigh the 3 key rewards and 2 important warning signs
Looking for more investment ideas beyond Targa Resources?
If Targa Resources has sharpened your focus, do not stop here. Broader context across sectors and styles can help you stress test your thinking and stay ahead.
- Spot potential value opportunities early and compare them with Targa Resources by scanning 53 high quality undervalued stocks that currently combine quality with attractive pricing.
- Build staying power into your portfolio by reviewing 80 resilient stocks with low risk scores that aim for resilience when conditions change.
- Give yourself a shot at the next overlooked winner before it is crowded by checking the screener containing 19 high quality undiscovered gems.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com