User blog comment:Leek0421/Fairy Tail vs The Balam Alliance/@comment-7418318-20150731190954/@comment-7418318-20150803205315

Don't forget that Tartaros was the most secretive of the three guilds.

With them hiding their true strength, it's hardly surprising that other's would underestimate them and mistakenly put GH over the in the power-scale.

Besides, it might even be true that they used to be weaker than GH, but grew so powerful in the seven years of the first timeskip.... I doubt that was the case, but it's possible.