Targa Resources to Boost 2026 Dividend 25% Following Record $4.96B EBITDA
Targa Resources grew Permian volumes 11% in 2025 to a record 6.65 Bcf/d and plans eight projects adding 2.2 Bcf/d processing capacity and 320,000 bpd of NGL output by 2027. The board hiked the 2026 dividend 25% to $5 per share, supported by 2025 adjusted EBITDA of $4.96 billion and forecast of $5.4–5.6 billion.
1. Volume Growth and Infrastructure Projects
Targa Resources reported 11% volume growth in its Permian operations in 2025, reaching 6.65 Bcf/d in the fourth quarter. The company is executing eight new processing and fractionation projects, expected to add 2.2 Bcf/d of gas processing capacity and about 320,000 bpd of NGL output by end-2027 under fee-based contracts.
2. Dividend Hike and Cash Flow Support
Management announced a 25% increase in the common dividend to $5 per share for 2026, reflecting confidence in cash flow durability. Steady fee-based revenues and ongoing share buybacks have bolstered free cash flow, underpinning the larger shareholder distribution.
3. Adjusted EBITDA Performance and Forecast
Targa Resources achieved a record $4.96 billion adjusted EBITDA in 2025 and projects growth to $5.4–5.6 billion in 2026, driven by higher Permian throughput and new project contributions. Revenue is estimated at $21.7 billion next year, up 27.3% year-over-year.
4. Capex Intensity and Risk Factors
Capital expenditures reached $3.3 billion in 2025 and are forecast at $4.5 billion for 2026, reflecting heavy investment in growth projects. Dependence on Permian drilling activity and potential project delays pose risks to throughput volumes, utilization rates and near-term cash flow.