Hess Midstream Partners (HESM) AI Stock Analysis

• Market Cap: $7.04B
• Dividend Yield: 8.56%
• Average Volume (3M): 1.56M
• Price to Earnings (P/E): 11.9
• Beta (1Y): 0.52
• Revenue Growth: 10.78%
• EPS Growth: 19.10%
• Country: US
• Employees: 176
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Midstream
• EPS (TTM): 0.75
• Shares Outstanding: 131,084,600
• 10 Day Avg. Volume: 1,794,911
• 30 Day Avg. Volume: 1,562,909
• PEG Ratio: 0.78
• Price to Book (P/B): 6.21
• Price to Sales (P/S): 2.21
• P/FCF Ratio: 5.20
• Enterprise Value/Market Cap: 0.00
• Enterprise Value/Revenue: 0.00
• Enterprise Value/Gross Profit: 0.00
• Enterprise Value/Ebitda: 0.00
• 1Y Price Target: $38.75
• Price Target Upside: 14.27% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 8
• EPS Forecast (FY): 2.82
• Revenue Forecast (FY): $1.64B

• Rating: 72 Outperform
• Price Target: $38.00 ▲(12.06% Upside)

Hess Midstream Partners' strong financial performance and attractive valuation are key strengths, supported by robust profitability and a high dividend yield. However, technical indicators suggest a bearish trend, and high leverage poses a risk. The earnings call reflects solid operational performance but also highlights potential growth challenges.

Positive Factors

Revenue Model

The fee-based model with long-term contracts ensures stable and predictable cash flows, reducing exposure to commodity price volatility.

Cash Flow Generation

Strong cash generation capabilities enhance financial stability, allowing for reinvestment in growth opportunities and shareholder returns.

Dividend Growth

The commitment to dividend growth reflects confidence in future cash flows and enhances attractiveness to income-focused investors.

Negative Factors

High Leverage

Significant leverage can strain financial flexibility and increase risk, especially in volatile market conditions.

Growth Challenges

The suspension of the Capa gas plant project may limit future expansion opportunities and affect long-term growth prospects.

Net Income Decline

A decline in net income, even if slight, can indicate potential operational challenges and affect investor confidence in sustained profitability.

Hess Midstream Partners Business Overview & Revenue Model

Company Description

Hess Midstream Partners LP (HESM) is a leading provider of integrated midstream services to the oil and gas industry, primarily focused on the Bakken shale formation in North Dakota. The company operates through three main sectors: gathering and processing, transportation, and terminaling and storage. Hess Midstream offers a range of services including the transportation of crude oil, natural gas, and produced water, as well as processing facilities that separate hydrocarbons and manage byproducts.

How the Company Makes Money

Hess Midstream generates revenue through a fee-based model, which is primarily structured around long-term contracts with customers. The company earns money by charging fees for its gathering and processing services, as well as transportation and terminaling services. Key revenue streams include fixed fees for throughput volumes, which provide predictable cash flow regardless of commodity price fluctuations, and variable fees that can depend on the volume of oil and gas processed or transported. Significant partnerships with Hess Corporation, which is a major oil producer in the Bakken region, contribute to stable earnings, as they ensure a consistent demand for Hess Midstream's services. Additionally, the company benefits from investments in infrastructure that enhance operational efficiency and capacity, further supporting its revenue generation capabilities.

Hess Midstream Partners Financial Statement Overview

Summary

Hess Midstream Partners shows strong profitability and cash flow generation, with high margins and efficient operations. However, the high debt-to-equity ratio indicates significant leverage, which poses a potential risk.

Income Statement

Hess Midstream Partners demonstrates strong profitability with a high gross profit margin of 86.8% and a solid net profit margin of 18.6% for the TTM. Revenue growth is positive at 3.2%, indicating steady expansion. The EBIT and EBITDA margins are robust at 63.0% and 76.2% respectively, showcasing efficient operations. Overall, the income statement reflects a healthy financial performance with consistent growth and profitability.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 5.85, indicating significant leverage, which could pose a risk if not managed properly. However, the return on equity is strong at 50.6%, suggesting effective use of equity to generate profits. The equity ratio stands at 14.4%, reflecting a moderate level of equity financing. While profitability is strong, the high leverage warrants caution.

Cash Flow

Cash flow analysis shows a substantial free cash flow growth rate of 87.8% for the TTM, indicating strong cash generation capabilities. The operating cash flow to net income ratio is high at 4.51, suggesting efficient cash conversion. The free cash flow to net income ratio is healthy at 69.2%, highlighting the company's ability to generate cash relative to its net income. Overall, cash flow metrics are strong, supporting the company's financial stability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.57B	1.49B	1.35B	1.27B	1.20B	1.09B
Gross Profit	1.36B	1.29B	1.15B	1.09B	1.04B	934.70M
EBITDA	1.19B	1.14B	1.02B	977.80M	903.40M	743.60M
Net Income	290.90M	223.10M	118.60M	83.90M	46.40M	24.00M
Balance Sheet
Total Assets	4.42B	4.15B	3.79B	3.59B	3.49B	3.37B
Cash, Cash Equivalents and Short-Term Investments	4.50M	4.30M	5.40M	3.10M	2.20M	2.60M
Total Debt	3.71B	3.47B	3.21B	2.89B	2.56B	1.91B
Total Liabilities	3.92B	3.69B	3.43B	3.06B	2.73B	2.05B
Stockholders Equity	635.00M	530.70M	340.20M	245.10M	204.10M	125.00M
Cash Flow
Free Cash Flow	666.40M	634.20M	642.90M	622.90M	632.30M	340.60M
Operating Cash Flow	962.70M	940.30M	866.40M	861.10M	795.50M	641.70M
Investing Cash Flow	-296.30M	-306.10M	-223.50M	-238.20M	-163.20M	-301.00M
Financing Cash Flow	-761.50M	-635.30M	-640.60M	-622.00M	-632.70M	-341.40M

Hess Midstream Partners Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 33.91
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HESM, the sentiment is Neutral. The current price of 33.91 is above the 20-day moving average (MA) of 32.79, below the 50-day MA of 34.82, and below the 200-day MA of 37.07, indicating a neutral trend. The MACD of -0.20 indicates Negative momentum. The RSI at 54.96 is Neutral, neither overbought nor oversold. The STOCH value of 12.92 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HESM.

Hess Midstream Partners Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AM	78 Outperform	$8.44B	18.16	22.52%	5.08%	8.70%	21.42%
WES	78 Outperform	$15.91B	11.54	40.29%	9.25%	5.81%	-13.58%
DTM	75 Outperform	$11.59B	28.91	9.04%	2.91%	20.39%	-3.85%
HESM	72 Outperform	$7.04B	11.91	―	8.56%	10.78%	19.10%
PAA	72 Outperform	$11.70B	13.52	9.78%	9.14%	-7.50%	9.49%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
KNTK	54 Neutral	$5.45B	84.50	―	8.93%	15.00%	-84.96%

Hess Midstream Partners Corporate Events

Hess Midstream LP Reports Strong Q3 2025 Results

Hess Midstream LP is a growth-oriented midstream company that operates in the energy sector, providing oil, gas, and water handling services primarily in the Bakken and Three Forks Shale plays in North Dakota. In the third quarter of 2025, Hess Midstream LP reported a net income of $175.5 million, an increase from the previous year, with net income attributable to the company at $97.7 million or $0.75 per Class A share. The company achieved an Adjusted EBITDA of $320.7 million and an Adjusted Free Cash Flow of $186.8 million, reflecting strong operational performance and increased throughput volumes in gas processing, oil terminaling, and water gathering. Key financial highlights include a $70 million repurchase of Class A shares and a $30 million repurchase of Class B units, alongside an increased quarterly cash distribution to $0.7548 per Class A share. The company also completed a new compressor station, enhancing its capacity. Looking ahead, Hess Midstream LP expects net income of $170-$180 million and Adjusted EBITDA of $315-$325 million for the fourth quarter of 2025, with a reduced capital expenditure guidance for the full year due to the suspension of the Capa gas plant project.

Hess Midstream Partners Announces Leadership Change

On September 4, 2025, John A. Gatling resigned as President and COO of Hess Midstream GP LLC, effective September 26, 2025. Michael S. Bast was appointed as his successor. Mr. Bast, who has been with Hess since 2007 and has held various roles, will also become an employee of Chevron U.S.A. Inc. on October 1, 2025. His appointment is expected to continue the company’s focus on efficient operations in the Bakken region, with no additional compensation from Hess Midstream for his role.

The most recent analyst rating on (HESM) stock is a Hold with a $46.00 price target. To see the full list of analyst forecasts on Hess Midstream Partners stock, see the HESM Stock Forecast page.

Hess Midstream Announces $100 Million Repurchase Agreement

On August 4, 2025, Hess Midstream LP announced a $100 million repurchase agreement, including the repurchase of $30 million in Class B units from Chevron’s subsidiary and $70 million in Class A shares from the public. This strategic move, approved by the board and its conflicts committee, is part of Hess Midstream’s financial strategy to return capital to shareholders, potentially increasing distributable cash flow per share and providing capacity for distribution growth above the annual target through 2027.

The most recent analyst rating on (HESM) stock is a Buy with a $47.00 price target. To see the full list of analyst forecasts on Hess Midstream Partners stock, see the HESM Stock Forecast page.