Using the PEG framework with analyst consensus forward EPS growth of 16.9% plus 1.5% dividend yield, Targa Resources Corp. has a fair value of $170.14 based on NTM EPS (FY2026) of $10.05. The current PEG ratio is 1.47.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG is most informative for high-growth companies — the PEG sweet spot.
| EPS Growth RateForward | 15.4% |
| Dividend Yield | +1.5% |
| Adjusted Growth (clamped 8–25%) | 16.9% |
| Fair P/E | 16.9x |
| NTM EPS (FY2026) | $10.05 |
| Fair Value | $170.14 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $8.52 | — | — |
| FY2026E | $10.05 | +18.0% | 4 |
| FY2027E | $11.35 | +12.9% | 4 |
2Y Forward EPS CAGR: 15.4%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $71.2M | $-0.07 | — |
| FY2022 | $1.1B | $3.88 | — |
| FY2023 | $828.2M | $3.66 | -5.6% |
| FY2024 | $1.3B | $5.74 | +56.6% |
| FY2025 | $1.8B | $8.52 | +48.4% |
4Y Historical EPS CAGR: 33.2%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.