Targa Resources (NYSE:NGLS) closed Tuesday's frenetic trading session at $33.48. In the past year, the stock has hit a 52-week low of $22.16 and 52-week high of $35.62. Targa Resources stock has been showing support around $32.69 and resistance in the $34.11 range. Technical indicators for the stock are Bearish and S&P gives NGLS a neutral 3 STARS (out of 5) hold rating. For a hedged play on this stock, look at the Sep '11 $33.00 covered call for a net debit in the $32.13 area. That is also the break-even stock price for this trade. This covered call has a duration of 101 days, provides 4.03% downside protection and an assigned return rate of 2.71% for an annualized return rate of 9.79% (for comparison purposes only). Targa Resources has a current annual dividend yield of 6.63%.
Or you could look at the long term fundamentals and own NGLS because it is a very good long term bet on well-positioned G&P assets in TX and LA. Where by the way Exxon made two significant discoveries announced yesterday.
Not so significant, imo. Smaller than the SPR, in fact. Based on the reported size, it would be enough to power the world for 8 days or the US for 28 days. When finds this size are reported as very significant, it is a reminder that peak oil is here.