Targa Resources vs Williams Companies
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KIRA’s take AI analyst
I put Targa Resources and Williams Companies side by side, using each one’s latest annual report. Here is what stands out:
- Targa Resources is the larger business, with $17.0B of revenue in fiscal 2025 against $12.0B for Williams Companies.
- Williams Companies grew revenue faster (13.8%, against 4.0%).
- Williams Companies kept more of each dollar of sales as operating profit (35.1% operating margin, against 19.6%).
- Williams Companies turned more of its sales into free cash flow (8.4% FCF margin, against 3.4%).
- Targa Resources earned a higher return on the capital invested in it (13.3%, against 7.5%).
- Investors pay more for each dollar of Targa Resources’s earnings: a P/E of 29.1x against 28.6x for Williams Companies.
Who comes out ahead
Of the 10 measures where higher (or lower) is clearly better, how many each company leads.
Targa Resources
TRGP
5/10
5-year growthReturn on capitalReturn on equityNet debt / EBITDAShare count change
Williams Companies
WMB
4/10
Revenue growthOperating marginNet marginFCF margin
Side by side
Best in the row
| Latest fiscal year | TRGP FY25 | WMB FY25 |
|---|---|---|
| Size | ||
| Market cap | $65.6B | $87.9B |
| Revenue | $17.0B | $12.0B |
| Free cash flow | $584M | $1.0B |
| Net income | $1.9B | $2.6B |
| Growth | ||
| Revenue growth | 4.0% | 13.8% |
| 5-year growth | 15.6% | 9.1% |
| Share count change | −2.0% | 0.2% |
| Profitability | ||
| Gross margin | 38.3% | — |
| Operating margin | 19.6% | 35.1% |
| Net margin | 11.3% | 21.9% |
| FCF margin | 3.4% | 8.4% |
| Return on capital | 13.3% | 7.5% |
| Return on equity | 68.0% | 20.7% |
| Balance sheet | ||
| Net debt | $17.6B | $29.3B |
| Net debt / EBITDA | 3.6x | 4.5x |
| Dividends and buybacks | $642M | $2.4B |
| Valuation & quality | ||
| P/E | 29.1x | 28.6x |
| Piotroski F-score | 6 | 6 |
Ten years
Revenue
Operating margin
Free cash flow
Return on capital
Each company's latest fiscal year; fiscal years end in different months. The best value in each row is highlighted where higher (or lower) is clearly better. Not investment advice.