Targa Resources (TRGP) stock has tripled in the last year, outperforming its peers in the sector. Let’s take a look at the stock’s current valuation.
Targa Resources is currently trading at an EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) multiple of nearly 14x, close to the average multiple for its selected peers.
The graph above compares TRGP’s EV-to-EBITDA multiple with those of its selected peers. Kinder Morgan (KMI) is trading at a lower multiple compared to TRGP. On the other hand, Magellan Midstream Partners (MMP) is trading at a much higher EV-to-EBITDA multiple than TRGP.
So, Targa Resources stock seems to be trading at a fair valuation, despite a three-fold increase in its price in the last year.