Targa Resources Inc (TRGP)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 25.98% | 25.24% | 14.10% | 13.86% | 27.72% |
| Operating profit margin | 16.45% | 16.35% | 8.26% | 7.61% | 46.12% |
| Pretax margin | 11.83% | 12.10% | 7.95% | 2.58% | -19.04% |
| Net profit margin | 7.81% | 8.38% | 4.28% | 2.49% | -16.04% |
Targa Resources Inc's profitability ratios demonstrate fluctuating performance over the years. The gross profit margin decreased from 27.72% in 2020 to 13.86% in 2021, but then improved slightly to 14.10% in 2022 before rising significantly to 25.24% in 2023 and further to 25.98% in 2024. This indicates that the company's ability to generate profits from its core operations has shown a rebound in recent years.
The operating profit margin followed a similar trend, dropping sharply from 46.12% in 2020 to 7.61% in 2021, then recovering to 8.26% in 2022 and experiencing steady growth to reach 16.45% in 2024. Despite the initial decline, the company's operational efficiency has improved over the years, leading to healthier profitability.
The pretax margin was negative in 2020 at -19.04%, indicating that the company incurred sizable expenses relative to its revenue. However, Targa Resources Inc managed to turn this around in the following years, with pretax margins of 2.58% in 2021, 7.95% in 2022, 12.10% in 2023, and 11.83% in 2024. This suggests better cost management and operational effectiveness, resulting in higher profitability before taxes.
Lastly, the net profit margin, reflecting the company's bottom-line profitability, improved from -16.04% in 2020 to 2.49% in 2021, and continued to rise to 4.28% in 2022, 8.38% in 2023, and 7.81% in 2024. The positive trend in net profit margin indicates that Targa Resources Inc has been able to control costs and enhance operational performance, translating into better overall profitability for its shareholders.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 11.86% | 12.70% | 8.84% | 8.48% | 24.00% |
| Return on assets (ROA) | 5.63% | 6.51% | 4.58% | 2.78% | -8.35% |
| Return on total capital | 104.35% | 96.01% | 64.86% | 29.87% | -39.99% |
| Return on equity (ROE) | 49.34% | 49.13% | 33.64% | 15.29% | -44.83% |
Targa Resources Inc's profitability ratios show a mixed performance over the years. The Operating Return on Assets (Operating ROA) decreased from 24.00% in December 2020 to 8.48% in December 2021, but then slightly improved to 8.84% in December 2022 before showing a significant increase to 12.70% in December 2023 and maintaining at 11.86% in December 2024.
Similarly, the Return on Assets (ROA) ratio was negative at -8.35% in December 2020, but improved to 2.78% in December 2021 and further increased to 6.51% in December 2023, ending at 5.63% in December 2024.
The Return on Total Capital ratio saw a significant improvement from negative levels of -39.99% in December 2020 to 29.87% in December 2021, then surged to 64.86% in December 2022, further increasing to 96.01% in December 2023 and reaching 104.35% in December 2024.
Lastly, the Return on Equity (ROE) ratio showed a similar trend, starting from a negative value of -44.83% in December 2020, then steadily increasing to 33.64% in December 2022, and peaking at 49.34% in December 2024.
Overall, Targa Resources Inc's profitability ratios indicate an improving trend in profitability and efficiency in utilizing assets and capital, albeit with some fluctuations year over year. It is important for investors and stakeholders to monitor these ratios to assess the company's financial health and performance.