Targa Resources reported higher third-quarter earnings and adjusted EBITDA than a year earlier, supported by record Permian inlet volumes and record NGL transportation and fractionation volumes. The company also set a higher 2026 earnings floor, outlined additional processing and fractionation projects, and said it expects to recommend a 20% increase in its 2027 common dividend.
Key details
-
Earnings rose year over year. Net income attributable to Targa was $658 million, up from $478 million in the third quarter of 2025. Adjusted EBITDA, a non-GAAP measure, increased 18% to $1.504 billion from $1.275 billion.
-
Results eased from the prior quarter. Adjusted EBITDA was down 6% from the second quarter of 2026. In gathering and processing, higher margins reflected record Permian natural gas inlet volumes and higher natural gas and NGL prices. In logistics and transportation, record NGL pipeline and fractionation volumes were offset by lower marketing and LPG export margins. Targa attributed the weaker marketing margin to fewer optimization opportunities, and the lower export margin to reduced volumes and fees.
-
The company expects at least $6.0 billion of adjusted EBITDA for full-year 2026. It continues to estimate net growth capital spending of about $5.0 billion for the year.
-
Targa is advancing further capacity additions. It plans to order long-lead equipment for one additional processing plant in the Permian Midland and two in the Permian Delaware. It is also moving forward with a new NGL fractionation train, Train 14, in Mont Belvieu, Texas.
-
Several projects are already progressing or entering service. Train 12, a fractionator, and the Bull Run Extension residue pipeline recently began operations, both ahead of schedule. The Copperhead processing plant in the Permian Delaware is in start-up. The company had also announced three Permian Delaware processing plants—Wrangler, Ranger and Ranger II—to support 20-year, fee-based agreements with ExxonMobil subsidiaries for gathering, processing and downstream services.
-
Targa expects to recommend a higher 2027 dividend. The proposed annual common dividend is $6.00 per share, 20% above the $5.00 annualized rate for 2026. The 2027 amount is an expectation for a recommendation to the board, not a dividend declared in this announcement.
-
The current dividend is $1.25 per share for the third quarter. Declared in October, it equals $5.00 per share on an annualized basis and is 25% above the dividend for the year-earlier quarter. Targa said about $268 million would be paid on November 17 to shareholders of record on October 30.
-
Targa also repurchased shares. During the quarter, it bought back 180,768 common shares at a weighted average price of $287.64, for a total net cost of $52 million. It had $1.187 billion remaining under its repurchase programs at September 30.
-
Debt and liquidity: Consolidated debt was $19.8 billion at September 30. It included $17.9 billion of senior unsecured notes, $860 million under the commercial paper program, $451 million under a receivables securitization facility and $796 million of finance lease liabilities. Total consolidated liquidity was approximately $2.9 billion, including $2.6 billion available under Targa’s revolver.
Plain-English implications
Targa’s results show year-over-year growth alongside a sequential decline caused by weaker marketing and export margins. Its earnings outlook and continued investment in new processing and fractionation capacity point to ongoing expansion, while the expected 2027 dividend recommendation would increase the annual payout from the current $5.00 rate.