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Hess Midstream Partners
(NYSE:HESM)
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Rating:68Neutral
Price Target:
$37.00
â–¼(-5.32% Downside)
Action:Reiterated
Date:10/09/26
The score is primarily driven by strong financial performance (high margins and robust cash flow) tempered by leverage and a sharp TTM revenue drop. Valuation is supportive due to a moderate P/E and very high dividend yield, while the latest earnings call and the DJ Basin acquisition/restructuring add a constructive outlook. The main near-term drag is weak technicals: price is below all major moving averages with negative momentum.
Positive Factors
Contracted Fee-Based Midstream Model
The fee-based model reduces direct commodity-price exposure and makes cash flows primarily dependent on contracted services and throughput. Long-term agreements with Hess provide commercial visibility, while dedicated infrastructure supports recurring revenue as Bakken production continues.
Negative Factors
Elevated Leverage
High leverage leaves HESM more exposed to refinancing conditions and interest-cost increases, which can absorb cash that might otherwise fund distributions, growth or debt reduction. The relatively small equity base magnifies balance-sheet sensitivity during weaker operating periods.
Read all positive and negative factors
Positive Factors
Negative Factors
Contracted Fee-Based Midstream Model
The fee-based model reduces direct commodity-price exposure and makes cash flows primarily dependent on contracted services and throughput. Long-term agreements with Hess provide commercial visibility, while dedicated infrastructure supports recurring revenue as Bakken production continues.
Read all positive factors
Hess Midstream Partners (HESM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.31B
Dividend Yield10.08%
Average Volume (3M)2.54M
Price to Earnings (P/E)10.6
Beta (1Y)0.21
Revenue Growth2.78%
EPS Growth7.61%
CountryUS
Employees195
SectorEnergy
Sector Strength52
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)2.90
Shares Outstanding128,350,880
10 Day Avg. Volume3,175,244
30 Day Avg. Volume2,541,129
Financial Highlights & Ratios
PEG Ratio0.84
Price to Book (P/B)7.47
Price to Sales (P/S)2.63
P/FCF Ratio5.83
Enterprise Value/Market Cap1.33
Enterprise Value/Revenue5.20
Enterprise Value/Gross Profit6.44
Enterprise Value/Ebitda6.80
Forecast
1Y Price Target
$33.33Price Target Upside-14.70% Downside
Rating ConsensusModerate Sell
Number of Analyst Covering6
EPS Forecast (FY)3.08
Revenue Forecast (FY)$1.61B
Hess Midstream Partners Business Overview & Revenue Model
Company Description
Hess Midstream LP specializes in the ownership, development, operation, and acquisition of energy infrastructure assets positioned midstream in the value chain. The company organizes its business activities into three distinct operational segments...
How the Company Makes Money
HESM makes money by charging fees for midstream services under contracts with customers—most notably Hess Corporation and, in certain areas of the Bakken, other producers. Its revenue model is primarily fee-based (as opposed to taking direct commo...
Hess Midstream Partners Earnings Call Summary
Earnings Call Date:Aug 03, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Positive
The call conveyed a generally positive operational and financial picture: strong margins (85%), reiterated robust adjusted free cash flow guidance (+20% YoY at midpoint), sequential net income and EBITDA improvement, active debt reduction and a clear plan to return excess cash to shareholders. Near-term headwinds include phased maintenance driving higher Q3 OpEx, a small sequential decline in adjusted free cash flow, and flat-to-lower oil throughput. Guidance is conservative on EBITDA due to weather and execution sensitivity, but capital efficiency and liquidity improvements underpin a constructive outlook.Positive Updates
Reiterated 2026 Adjusted Free Cash Flow Guidance (Strong Growth)
Company re-affirmed 2026 adjusted free cash flow guidance of $910M to $960M, which implies a ~20% year-over-year increase at the midpoint versus 2025. Management emphasized this as a key financial priority to fund distributions, share repurchases and debt reduction.
Negative Updates
Oil Throughput Flat to Lower
Q2 throughput volumes: gas processing ~433 MMcf/d, crude terminaling ~117,000 bbl/d, water gathering ~121,000 bbl/d. Compared to Q1, oil throughput was flat to lower while gas increased; oil softness/flatness is a near-term headwind to crude-related revenue growth.
Read all updates
Q2-2026 Updates
Positive
Negative
Reiterated 2026 Adjusted Free Cash Flow Guidance (Strong Growth)
Company re-affirmed 2026 adjusted free cash flow guidance of $910M to $960M, which implies a ~20% year-over-year increase at the midpoint versus 2025. Management emphasized this as a key financial priority to fund distributions, share repurchases and debt reduction.
Read all positive updates
Company Guidance
The company reiterated 2026 guidance calling for adjusted free cash flow of $910–$960 million (about a 20% increase year‑over‑year at the midpoint) and excess adjusted free cash flow of roughly $280 million after fully funding a targeted 5% distribution increase, with full‑year net income of $650–$700 million and adjusted EBITDA of $1.225–$1.275 billion (roughly flat at the midpoint vs. 2025). Quarterly targets include Q2 results of net income $174 million, adjusted EBITDA $314 million and adjusted FCF ≈$232 million (Q2 capex ≈$31 million, net interest ≈$51 million, $256 million drawn on the revolver), Q2 throughput of ~433 MMcf/d gas, 117,000 bbl/d crude and 121,000 bbl/d water, and Q3 guidance of net income $165–$175 million and adjusted EBITDA $310–$320 million (expected flat at the midpoint vs. Q2) with higher Q3 capex and lower Q3 adjusted FCF; management expects second‑half volumes to grow (roughly ≥5% quarter‑on‑quarter into the second half) and to reduce leverage from ~3x toward about 2.5x by 2028.Hess Midstream Partners Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
46
Neutral
Cash Flow
86
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.61B | 1.62B | 1.49B | 1.35B | 1.27B | 1.20B |
| Gross Profit | 1.30B | 1.40B | 1.29B | 1.15B | 1.09B | 1.04B |
| EBITDA | 1.23B | 1.24B | 1.14B | 1.02B | 977.80M | 903.40M |
| Net Income | 375.00M | 352.90M | 223.10M | 118.60M | 83.90M | 46.40M |
Balance Sheet | ||||||
| Total Assets | 4.26B | 4.39B | 4.15B | 3.79B | 3.59B | 3.49B |
| Cash, Cash Equivalents and Short-Term Investments | 5.00M | 1.90M | 4.30M | 5.40M | 3.10M | 2.20M |
| Total Debt | 3.68B | 3.77B | 3.47B | 3.21B | 2.89B | 2.56B |
| Total Liabilities | 3.87B | 3.95B | 3.69B | 3.43B | 3.06B | 2.73B |
| Stockholders Equity | 514.60M | 568.30M | 530.70M | 340.20M | 245.10M | 204.10M |
Cash Flow | ||||||
| Free Cash Flow | 694.40M | 728.20M | 634.20M | 642.90M | 622.90M | 632.30M |
| Operating Cash Flow | 1.04B | 983.80M | 940.30M | 866.40M | 861.10M | 795.50M |
| Investing Cash Flow | -198.60M | -255.60M | -306.10M | -223.50M | -238.20M | -163.20M |
| Financing Cash Flow | -837.30M | -730.60M | -635.30M | -640.60M | -622.00M | -632.70M |
Hess Midstream Partners Technical Analysis
Negative
39.08
Price Trends
37.31
Negative
37.86
Negative
37.12
Negative
Market Momentum
-2.24
Positive
29.78
Positive
27.14
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HESM, the sentiment is Negative. The current price of 39.08 is above the 20-day moving average (MA) of 33.69, above the 50-day MA of 37.31, and above the 200-day MA of 37.12, indicating a bearish trend. The MACD of -2.24 indicates Positive momentum. The RSI at 29.78 is Positive, neither overbought nor oversold. The STOCH value of 27.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HESM.
Hess Midstream Partners Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $18.65B | 14.06 | 34.12% | 8.15% | 18.00% | -2.36% | |
74 Outperform | $9.90B | 24.82 | 20.19% | 4.32% | 7.19% | -11.58% | |
69 Neutral | $9.04B | 19.96 | -36.70% | 5.82% | 10.46% | 281.46% | |
69 Neutral | $12.64B | 26.94 | 9.87% | 2.79% | 18.12% | 22.38% | |
68 Neutral | $6.31B | 10.56 | 69.02% | 10.08% | 2.78% | 7.61% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
65 Neutral | $633.82M | -28.37 | -0.48% | 40.11% | 20.94% | 95.10% |
* Energy Sector Average
HESM
Hess Midstream Partners
30.61
-0.38
-1.22%
WES
Western Midstream Partners
45.13
9.72
27.45%
SMC
Summit Midstream
31.21
9.56
44.16%
AM
Antero Midstream
20.85
3.72
21.73%
KNTK
Kinetik
55.70
19.02
51.86%
DTM
DT Midstream
123.91
20.15
19.42%
Hess Midstream Partners Corporate Events
Business Operations and StrategyExecutive/Board ChangesStock BuybackM&A Transactions
Hess Midstream Acquires Chevron DJ Basin Assets, Restructures
Positive
Oct 8, 2026
On October 6, 2026, Hess Midstream LP and Chevron signed a purchase and sale agreement that will see Hess Midstream acquire Chevron’s crude oil, gas and storage assets in Colorado’s DJ Basin and Chevron’s entire ownership stake i...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.