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Antero Midstream (AM)
NYSE:AM
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Antero Midstream
(NYSE:AM)
Rating:78Outperform
Price Target:―
Positive Factors
Free Cash Flow
Free cash flow after dividend exceeded expectations by 34.2%.
Processing Volumes
Gross MPLX processing volumes were 2.2% higher than anticipated.
Share Buybacks
Buybacks are expected to provide support for the shares starting in Q4.
Negative Factors
Estimates Revision
Lowering 2024-2025 estimates due to lower assumed water volumes in Q4 and deferral of a second pad from early 2025 to later in the year.
Financial Results
There was a modest shortfall in financial results versus consensus.
Growth Projections
Q3 missed and a 2nd pad deferral by AR further moderates 2025 growth (low-single-digit %).
Antero Midstream (AM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$8.57B
Dividend Yield5.03%
Average Volume (3M)2.80M
Price to Earnings (P/E)19.0
Beta (1Y)0.56
Revenue Growth7.09%
EPS Growth17.53%
CountryUS
Employees616
SectorEnergy
Sector Strength46
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)0.26
Shares Outstanding478,501,000
10 Day Avg. Volume2,560,043
30 Day Avg. Volume2,799,509
Financial Highlights & Ratios
PEG Ratio2.32
Price to Book (P/B)3.43
Price to Sales (P/S)6.17
P/FCF Ratio12.06
Enterprise Value/Market Cap1.42
Enterprise Value/Revenue9.93
Enterprise Value/Gross Profit15.31
Enterprise Value/Ebitda12.93
Forecast
1Y Price Target
$17.67Price Target Upside0.68% Upside
Rating ConsensusModerate Sell
Number of Analyst Covering3
Antero Midstream Business Overview & Revenue Model
Company DescriptionAntero Midstream Corporation owns, operates, and develops midstream energy infrastructure. It operates through Gathering and Processing, and Water Handling segments. The Gathering and Processing segment includes a network of gathering pipelines and compressor stations that collects and processes production from Antero Resources' wells in West Virginia and Ohio. The Water Handling segment delivers fresh water; and offers pumping stations, water storage, and blending facilities. The company was incorporated in 2013 and is headquartered in Denver, Colorado.
How the Company Makes MoneyAntero Midstream makes money through a variety of revenue streams centered around its midstream services. The company earns revenue primarily from long-term, fixed-fee contracts with Antero Resources, which provide stable cash flows and mitigate commodity price exposure. Key revenue streams include gathering and compression fees, which are charged for transporting natural gas from production sites to processing facilities. Additionally, Antero Midstream generates income from water handling services, including the delivery and treatment of water used in hydraulic fracturing. The company's strategic partnerships and infrastructure investments further enhance its ability to meet the growing demand for midstream services in the Appalachian region, thereby contributing to its earnings.
Antero Midstream Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: 2.39%|
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong financial performance with significant growth in EBITDA, free cash flow, and successful debt reduction. The company's strategic initiatives, including increased guidance and capital reuse savings, further support a positive outlook. However, ongoing legal issues and concerns about processing capacity present challenges. Overall, the positive aspects significantly outweigh the negatives.Q2-2025 Updates
Positive Updates
Record EBITDA Growth
Antero Midstream reported $284 million of EBITDA for the second quarter, representing an 11% increase year-over-year, primarily driven by an increase in gathering and processing volumes.
Substantial Free Cash Flow Increase
Free cash flow after dividends reached $82 million, marking an almost 90% increase compared to the previous year.
Debt Reduction and Leverage
The company utilized free cash flow for share repurchases and debt reduction, decreasing leverage to 2.8x as of June 30.
Increased 2025 Guidance
Antero Midstream increased its free cash flow guidance by $25 million and raised adjusted EBITDA guidance by $10 million.
Capital Reuse Savings Exceed Expectations
Through its compression reuse program, Antero Midstream realized over $50 million in savings, with expected future savings increased to over $85 million from 2026 to 2030.
Favorable Tax Position
The recently passed budget reconciliation bill allows Antero Midstream to reduce cash income taxes, with no material cash taxation expected through at least 2028.
Negative Updates
Clearwater Facility Legal Uncertainty
Ongoing legal proceedings related to the Clearwater facility lawsuit remain unresolved, with no updates from the Colorado Supreme Court.
Processing Volume Concerns
Processing volumes exceeded capacity, raising questions about the need for additional processing infrastructure in the future.
Company Guidance
During the Antero Midstream 2Q 2025 Earnings Call, the company provided updated guidance metrics, highlighting a $25 million increase in free cash flow guidance for 2025. This was attributed to a $10 million rise in adjusted EBITDA, driven by record gathering and compression throughput, and a $5 million reduction in the capital budget range to a midpoint of $190 million. Additionally, the company achieved $50 million in savings through its compression reuse program, with projected 5-year savings increasing from $60 million to over $85 million, totaling over $135 million when combined with realized savings. The company also reported significant financial performance improvements, with second-quarter EBITDA reaching $284 million, marking an 11% year-over-year increase, and free cash flow after dividends increasing nearly 90% to $82 million. Antero Midstream further reduced its leverage to 2.8x and benefits from lower interest expenses by $5 million due to debt reduction efforts. The company also expects to avoid being a material cash taxpayer through at least 2028, thanks to recent legislative changes.Antero Midstream Financial Statement Overview
Summary
Antero Midstream exhibits strong profitability and cash generation with stable margins and substantial free cash flow growth. Although revenue growth is minimal and leverage is high, the company effectively utilizes equity to generate returns. The financial position is stable, but attention to debt levels is warranted.Income Statement
Antero Midstream shows strong profitability with a consistent gross profit margin reaching 100% in the latest year. The net profit margin improved to 36.24%, indicating efficient cost management. Revenue experienced a slight decline of 0.56% from the previous year, but EBIT and EBITDA margins are solid at 59.61%. Overall, profitability metrics are robust, though revenue growth is stagnant.85
Very Positive
Balance Sheet
The debt-to-equity ratio is high at 1.47, indicating significant leverage. However, return on equity improved to 18.95%, reflecting effective use of equity to generate profits. The equity ratio stands at 36.71%, suggesting moderate financial stability. While leverage is a concern, profitability offsets some risks.77
Positive
Cash Flow
Free cash flow grew by 41.86% over the past year, demonstrating strong cash generation. The operating cash flow to net income ratio is 2.10, indicating substantial cash inflows relative to net income. The free cash flow to net income ratio is 2.11, reflecting solid free cash flow relative to earnings. Overall, cash flow metrics highlight strong liquidity and cash generation capabilities.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.22B | 1.18B | 1.11B | 990.66M | 968.87M | 971.39M |
| Gross Profit | 794.91M | 748.22M | 692.37M | 607.97M | 149.90M | 626.54M |
| EBITDA | 940.70M | 966.51M | 824.95M | 836.34M | 803.94M | 148.43M |
| Net Income | 456.18M | 400.89M | 371.79M | 326.24M | 331.62M | -122.53M |
Balance Sheet | ||||||
| Total Assets | 5.73B | 5.76B | 5.74B | 5.79B | 5.54B | 5.61B |
| Cash, Cash Equivalents and Short-Term Investments | 0.00 | 0.00 | 66.00K | 0.00 | 0.00 | 640.00K |
| Total Debt | 3.02B | 3.12B | 3.21B | 3.36B | 3.12B | 3.09B |
| Total Liabilities | 3.64B | 3.65B | 3.59B | 3.60B | 3.26B | 3.19B |
| Stockholders Equity | 2.09B | 2.12B | 2.15B | 2.19B | 2.29B | 2.42B |
Cash Flow | ||||||
| Free Cash Flow | 929.70M | 601.65M | 595.06M | 183.95M | 476.93M | 595.45M |
| Operating Cash Flow | 881.75M | 843.99M | 779.06M | 699.60M | 709.75M | 753.38M |
| Investing Cash Flow | -166.65M | -242.73M | -183.21M | -493.83M | -233.24M | -219.23M |
| Financing Cash Flow | -715.11M | -601.33M | -595.79M | -205.78M | -477.15M | -534.75M |
Antero Midstream Technical Analysis
Neutral
17.55
Price Trends
17.87
Negative
17.62
Negative
16.48
Positive
Market Momentum
0.10
Positive
42.35
Neutral
15.30
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AM, the sentiment is Neutral. The current price of 17.55 is below the 20-day moving average (MA) of 17.86, below the 50-day MA of 17.87, and above the 200-day MA of 16.48, indicating a neutral trend. The MACD of 0.10 indicates Positive momentum. The RSI at 42.35 is Neutral, neither overbought nor oversold. The STOCH value of 15.30 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AM.
Antero Midstream Peers Comparison
Overall Rating
UnderperformOutperform
Sector (56)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $8.65B | 15.28 | 52.91% | 6.93% | 9.02% | 17.28% | |
78 Outperform | $8.57B | 19.05 | 21.65% | 5.03% | 7.09% | 17.53% | |
77 Outperform | $14.66B | 11.83 | 38.42% | 9.36% | 7.11% | -16.14% | |
75 Outperform | $10.51B | 27.80 | 8.48% | 3.01% | 15.28% | -9.99% | |
73 Outperform | $2.32B | 14.71 | 542.39% | 10.27% | -12.08% | 1.44% | |
56 Neutral | C$4.17B | 1.07 | 16.25% | 5.21% | 10.31% | -56.29% | |
44 Neutral | $391.47M | 5.86 | -25.85% | ― | 2.91% | -432.03% |
* Energy Sector Average
Performance Comparison
AM
Antero Midstream
17.55
3.59
25.72%
WES
Western Midstream Partners
38.15
2.67
7.53%
SMC
Summit Midstream
19.96
-15.73
-44.07%
DKL
Delek Logistics
43.15
8.10
23.11%
HESM
Hess Midstream Partners
40.87
6.49
18.88%
DTM
DT Midstream
101.95
28.53
38.86%
Antero Midstream Corporate Events
Stock BuybackDividendsFinancial Disclosures
Antero Midstream Declares Dividend and Plans Earnings Release
Positive
Jan 14, 2025
On January 14, 2025, Antero Midstream Corporation announced a cash dividend of $0.225 per share for the fourth quarter of 2024, payable on February 12, 2025. The company also repurchased approximately 1.9 million shares worth around $28.7 million during the same quarter, leaving $471 million of share repurchase capacity under its $500 million authorized program. Additionally, Antero Midstream plans to release its fourth-quarter 2024 earnings on February 12, 2025, with a conference call scheduled for February 13, 2025, to discuss the financial results.
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.