Energy Transfer LP (ET) vs Targa Resources, Inc. (TRGP)

Energy Transfer LP and Targa Resources, Inc. are both Oil & Gas Midstream companies. Energy Transfer LP is the larger, with a market value of $70.2B against $60.7B — 1.2× the size. Energy Transfer LP trades at the lower P/E: 13.7× against 26.5×. Energy Transfer LP grew revenue faster over the last twelve months: 33.3% against −1.97%. Targa Resources, Inc. has the higher net margin (13.5% vs 4.70%) and the higher return on invested capital (10.3% vs 5.72%). Both pay a dividend; Energy Transfer LP yields more (8.97% vs 2.27%). Across the 22 metrics below, Energy Transfer LP leads on 14 and Targa Resources, Inc. on 8.

Valuation

Metric ET TRGP Oil & Gas Midstream median
P/E 13.73 26.49 13.19
P/S 0.65 3.56 2.60
P/B 1.47 15.71 2.08
Price to free cash flow 13.30 80.48 10.14
EV/EBITDA 8.11 14.36 8.11
EV/Sales 1.27 4.72 3.89
Earnings yield 7.28% 3.78% 6.83%
Free cash flow yield 7.52% 1.24% 6.94%

Profitability

Metric ET TRGP Oil & Gas Midstream median
Gross margin 23.58% 43.19% 58.81%
Operating margin 10.04% 22.91% 32.14%
Net margin 4.70% 13.47% 21.16%
Free cash flow margin 4.87% 4.43% 10.15%
Return on equity 11.30% 69.32% 11.30%
Return on assets 3.70% 8.67% 5.00%
Return on invested capital 5.72% 10.31% 6.13%

Growth

Metric ET TRGP Oil & Gas Midstream median
Revenue growth (TTM) 33.27% (1.97%) 15.44%
EPS growth (last fiscal year) (5.47%) 47.91% —
Revenue growth, 5-year CAGR 17.04% 15.57% 8.96%
Net income growth, 5-year CAGR 0.00% 0.00% 0.00%

Health

Metric ET TRGP Oil & Gas Midstream median
Debt to equity 1.35 5.16 0.78
Current ratio 1.16 0.77 1.19
Net debt to EBITDA 4.56 3.55 3.42

Dividend

Metric ET TRGP Oil & Gas Midstream median
Dividend yield 8.97% 2.27% 7.29%
Payout ratio — — 0.64

Size

Metric ET TRGP Oil & Gas Midstream median
Market cap 70.21b 60.72b 3.61b

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