Western Midstream Partners (WES)
NYSE:WES
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Western Midstream Partners
(NYSE:WES)
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Rating:74Outperform
Price Target:
$49.00
â–²(20.87% Upside)
Action:ReiteratedDate:02/19/26
The score is driven primarily by strong underlying financial performance (high margins and solid operating cash generation) and an attractive valuation/income profile (moderate P/E with a high dividend yield). Technicals support an uptrend, but overbought momentum indicators and guidance for lower 2026 free cash flow versus 2025 temper the overall rating.
Positive Factors
Fee‑based contracts provide stable cash flows
Western’s fee-based revenue model and long-term contractual arrangements create predictable cash inflows that reduce commodity-price sensitivity, supporting durable distributable cash flow, predictable capex funding and the ability to service debt and invest in growth projects over multiple years.
Negative Factors
Free cash flow decline and volatility
A materially lower FCF midpoint for 2026 versus 2025 reduces the near-term cash cushion and constrains discretionary options. Persistent FCF volatility complicates multi-year planning for distributions, deleveraging and execution of expansion projects despite strong underlying EBITDA generation.
Read all positive and negative factors
Positive Factors
Negative Factors
Fee‑based contracts provide stable cash flows
Western’s fee-based revenue model and long-term contractual arrangements create predictable cash inflows that reduce commodity-price sensitivity, supporting durable distributable cash flow, predictable capex funding and the ability to service debt and invest in growth projects over multiple years.
Read all positive factors
Western Midstream Partners (WES) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$16.76B
Dividend Yield9.13%
Average Volume (3M)1.34M
Price to Earnings (P/E)21.1
Beta (1Y)0.33
Revenue Growth6.61%
EPS Growth-25.64%
CountryUS
Employees1,511
SectorEnergy
Sector Strength52
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)3.01
Shares Outstanding393,667,420
10 Day Avg. Volume1,252,138
30 Day Avg. Volume1,343,611
Financial Highlights & Ratios
PEG Ratio-0.53
Price to Book (P/B)3.93
Price to Sales (P/S)4.12
P/FCF Ratio10.80
Enterprise Value/Market Cap1.53
Enterprise Value/Revenue6.65
Enterprise Value/Gross Profit9.71
Enterprise Value/Ebitda11.10
Forecast
1Y Price Target
$41.40Price Target Upside2.12% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)3.19
Revenue Forecast (FY)$4.12B
Western Midstream Partners Business Overview & Revenue Model
Company Description
Western Midstream Partners, LP, a midstream energy company, together with its subsidiaries, acquires, owns, develops, and operates primarily in the United States. It is involved in gathering, compressing, treating, processing, and transporting nat...
How the Company Makes Money
Western Midstream Partners generates revenue primarily through fee-based contracts, which provide stable cash flows regardless of commodity price fluctuations. Key revenue streams include gathering and processing fees from natural gas and NGLs, tr...
Western Midstream Partners Earnings Call Summary
Earnings Call Date:Feb 18, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Aug 12, 2026
Earnings Call Sentiment Positive
The call presented a largely constructive picture: Western Midstream delivered record adjusted EBITDA and free cash flow in 2025, successfully closed and integrated the Aris acquisition ahead of plan, realized meaningful cost synergies, and maintained a conservative balance sheet with flexibility to adjust capital spending. However, the company faces notable near-term headwinds — producer activity reductions (including reallocation by Oxy), Waha hub pricing-related curtailments, basin-specific declines (DJ and Powder River), and some one-time accounting and transaction impacts that pressure margins and 2026 free cash flow. Management emphasized discipline, flexibility in capex, and a long-term mid- to low-single-digit adjusted EBITDA growth target, while taking a conservative approach to distributions in 2026.Positive Updates
Record Adjusted EBITDA and Sequential Improvement
Fourth quarter adjusted EBITDA of $636 million (would have been $665 million excluding $29.5 million of noncash revenue adjustments), representing ~5% sequential quarter increase on an adjusted basis; full-year 2025 adjusted EBITDA of $2.48 billion, up ~6% year-over-year and above the midpoint of guidance.
Negative Updates
Near-Term Activity Reductions from Producers
Producers updated forecasts indicate reduced activity on acreage WES services (including reallocation by Oxy), moderating 2026 throughput: partnership-wide natural gas expected to be flat YoY and crude oil & NGLs expected to decline by low- to mid-single digits YoY.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Adjusted EBITDA and Sequential Improvement
Fourth quarter adjusted EBITDA of $636 million (would have been $665 million excluding $29.5 million of noncash revenue adjustments), representing ~5% sequential quarter increase on an adjusted basis; full-year 2025 adjusted EBITDA of $2.48 billion, up ~6% year-over-year and above the midpoint of guidance.
Read all positive updates
Company Guidance
Western’s 2026 guidance calls for adjusted EBITDA of $2.5–$2.7 billion (midpoint $2.6B, ≈5% YoY at midpoint), capital expenditures of $850M–$1.0B (midpoint $925M, ~50% directed to Pathfinder and North Loving II), distributable cash flow (DCF) of $1.85B–$2.05B (midpoint $1.95B; $4.59–$5.08 per unit), and free cash flow of $900M–$1.1B (midpoint $1.0B); the range includes estimated first‑quarter winter storm impacts of $10M–$20M. Operational guidance assumes partnership‑wide natural gas throughput roughly flat, crude oil/NGL throughput down low‑ to mid‑single digits, and produced water throughput up >80% YoY (driven by Aris); average 2026 adjusted gross margins are expected at ~$1.22/Mcf for natural gas, $3.10–$3.15/barrel for crude oil & NGLs (Q1: $3.05–$3.10/bbl), and ~$0.85/barrel for produced water. The company plans to recommend a $0.02/unit increase starting Q1 for a full‑year distribution of at least $3.70/unit (annualized ≈$3.72) while maintaining a strong balance sheet (net leverage ~3x).Western Midstream Partners Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
70
Positive
Cash Flow
73
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 3.84B | 3.61B | 3.11B | 3.25B | 2.88B |
| Gross Profit | 2.63B | 2.78B | 2.34B | 2.25B | 2.00B |
| EBITDA | 2.30B | 2.64B | 1.99B | 2.16B | 1.85B |
| Net Income | 1.17B | 1.57B | 1.02B | 1.22B | 916.29M |
Balance Sheet | |||||
| Total Assets | 15.00B | 13.14B | 12.47B | 11.27B | 11.27B |
| Cash, Cash Equivalents and Short-Term Investments | 819.49M | 1.09B | 272.79M | 286.66M | 202.00M |
| Total Debt | 8.93B | 8.14B | 7.96B | 6.83B | 6.95B |
| Total Liabilities | 10.84B | 9.77B | 9.44B | 8.16B | 8.18B |
| Stockholders Equity | 4.02B | 3.24B | 2.90B | 2.97B | 2.96B |
Cash Flow | |||||
| Free Cash Flow | 1.46B | 1.27B | 913.12M | 1.21B | 1.45B |
| Operating Cash Flow | 2.19B | 2.11B | 1.65B | 1.70B | 1.77B |
| Investing Cash Flow | -1.09B | -39.17M | -1.61B | -218.24M | -257.54M |
| Financing Cash Flow | -1.38B | -1.25B | -58.83M | -1.40B | -1.75B |
Western Midstream Partners Technical Analysis
Neutral
40.54
Price Trends
41.48
Negative
40.32
Positive
38.66
Positive
Market Momentum
-0.19
Positive
43.60
Neutral
27.57
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WES, the sentiment is Neutral. The current price of 40.54 is below the 20-day moving average (MA) of 41.31, below the 50-day MA of 41.48, and above the 200-day MA of 38.66, indicating a neutral trend. The MACD of -0.19 indicates Positive momentum. The RSI at 43.60 is Neutral, neither overbought nor oversold. The STOCH value of 27.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for WES.
Western Midstream Partners Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $15.98B | 9.27 | 14.75% | 8.54% | -10.83% | 129.74% | |
78 Outperform | $14.99B | 26.36 | 9.41% | 2.70% | 22.22% | 23.30% | |
74 Outperform | $16.76B | 21.13 | 34.44% | 9.13% | 6.61% | -25.64% | |
74 Outperform | $8.21B | 11.96 | 59.38% | 8.45% | 7.06% | 13.61% | |
73 Outperform | $10.44B | 22.84 | 20.38% | 4.98% | 8.14% | -0.91% | |
66 Neutral | $18.46B | 15.28 | 19.19% | 8.03% | -10.83% | 150.21% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% |
* Energy Sector Average
WES
Western Midstream Partners
42.57
10.00
30.70%
PAA
Plains All American
22.65
7.71
51.62%
PAGP
Plains GP Holdings
24.23
8.25
51.60%
AM
Antero Midstream
21.99
5.30
31.76%
HESM
Hess Midstream Partners
39.52
5.17
15.06%
DTM
DT Midstream
146.97
49.36
50.58%
Western Midstream Partners Corporate Events
Business Operations and StrategyStock Buyback
Western Midstream Amends Key Gas Agreements, Redeems Units
Positive
Jan 22, 2026
On January 16, 2026, Western Midstream subsidiary Delaware Basin Midstream LLC amended its Delaware Basin gas gathering agreement with Occidental Petroleum’s Anadarko EP Onshore LLC, shifting from a cost-of-service to a fixed-fee structure, ...
Business Operations and StrategyM&A TransactionsPrivate Placements and Financing
Western Midstream Partners Completes $1.2 Billion Senior Notes Offering
Positive
Dec 4, 2025
On December 4, 2025, Western Midstream Operating, LP completed a public offering of $1.2 billion in senior notes due in 2031 and 2035. The proceeds will be used to repay maturing notes, reduce commercial paper program debt, and fund general partne...
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.