Targa Resources (TRGP) Is Today's Dead Cat Bounce Stock
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.Trade-Ideas LLC identified Targa Resources (TRGP) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Targa Resources as such a stock due to the following factors:
- TRGP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $110.0 million.
- TRGP has traded 607,472 shares today.
- TRGP is up 3.3% today.
- TRGP was down 8.3% yesterday.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in TRGP with the Ticky from Trade-Ideas. See the FREE profile for TRGP NOW at Trade-IdeasMore details on TRGP: Targa Resources Corp., through its general and limited partner interests in Targa Resources Partners LP, provides midstream natural gas and natural gas liquid (NGL) services in the United States. The company operates in two divisions, Gathering and Processing, and Logistics and Marketing. The stock currently has a dividend yield of 1.7%. TRGP has a PE ratio of 88.6. Currently there are 6 analysts that rate Targa Resources a buy, no analysts rate it a sell, and 7 rate it a hold.The average volume for Targa Resources has been 286,300 shares per day over the past 30 days. Targa has a market cap of $6.3 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.08 and a short float of 4.6% with 1.97 days to cover. Shares are up 56.6% year-to-date as of the close of trading on Friday.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.TheStreetRatings.com Analysis:TheStreet Quant Ratings rates Targa Resources as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity, good cash flow from operations, impressive record of earnings per share growth and compelling growth in net income. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.Highlights from the ratings report include:
- TRGP's very impressive revenue growth greatly exceeded the industry average of 3.2%. Since the same quarter one year prior, revenues leaped by 68.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- TARGA RESOURCES CORP has improved earnings per share by 46.9% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, TARGA RESOURCES CORP increased its bottom line by earning $1.55 versus $0.92 in the prior year. This year, the market expects an improvement in earnings ($2.64 versus $1.55).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Oil, Gas & Consumable Fuels industry average. The net income increased by 46.3% when compared to the same quarter one year prior, rising from $13.40 million to $19.60 million.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, TARGA RESOURCES CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Net operating cash flow has significantly increased by 83.16% to $318.70 million when compared to the same quarter last year. In addition, TARGA RESOURCES CORP has also vastly surpassed the industry average cash flow growth rate of 17.51%.
- You can view the full Targa Resources Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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