Targa Resources Corp. (TRGP) — payout ratio, three ways
Fiscal year ending 2025-12-31 · sector Utilities · computed from SEC filings, not taken from a data vendor.
| Basis | Payout | Why it differs |
|---|---|---|
| GAAP earnings | 44.2% | The basis that applies. A regulated utility earns an allowed return on its rate base, and the dividend is set against that. |
| Operating cash flow | 20.8% | Closer to meaningful than free cash flow, but still before the capital programme the regulator expects the company to run. |
| Free cash flow | 139.5% | What is left after the capital programme. For a regulated utility that programme is growth into the rate base, recovered through rates and funded by debt and equity issuance by design — so this figure swings with the capex cycle and frequently goes negative. It says little about whether the dividend is affordable. |
Spread between highest and lowest: 119 percentage points. Same filings, different denominators.
The arithmetic
- GAAP earnings — dividends declared per share $3.75 ÷ diluted EPS $8.49
- Operating cash flow — dividends paid $815.1m ÷ operating cash flow $3,917.4m
- Free cash flow — dividends paid $815.1m ÷ (operating cash flow $3,917.4m − capex $3,333.3m)
Where the figures came from
- 10-K filed 2026-02-19 · accession
0001193125-26-059296
Every one is public at sec.gov and free to check. That is the point — you should not have to take my word for any of it.
Computed by an open pipeline reading SEC XBRL directly. If any number here looks wrong to you, tell me — that is more useful to me than agreement.