Western Midstream Partners (WES) AI Stock Analysis

• Market Cap: $16.14B
• Dividend Yield: 9.13%
• Average Volume (3M): 1.27M
• Price to Earnings (P/E): 11.7
• Beta (1Y): 0.45
• Revenue Growth: 5.81%
• EPS Growth: -13.58%
• Country: US
• Employees: 1,511
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Midstream
• EPS (TTM): 0.87
• Shares Outstanding: 407,995,730
• 10 Day Avg. Volume: 1,051,499
• 30 Day Avg. Volume: 1,274,506
• PEG Ratio: 0.17
• Price to Book (P/B): 4.52
• Price to Sales (P/S): 4.05
• P/FCF Ratio: 11.47
• Enterprise Value/Market Cap: 1.36
• Enterprise Value/Revenue: 5.88
• Enterprise Value/Gross Profit: 7.73
• Enterprise Value/Ebitda: 9.11
• 1Y Price Target: $40.40
• Price Target Upside: 3.25% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5
• EPS Forecast (FY): 3.52
• Revenue Forecast (FY): $3.87B

• Rating: 80 Outperform
• Price Target: $45.00 ▲(15.00% Upside)

Western Midstream Partners scores well due to its strong financial performance and attractive valuation. The company's strategic acquisitions and financial maneuvers further bolster its position. While technical indicators show positive momentum, some operational challenges remain, particularly in throughput declines.

Positive Factors

Strategic Acquisition

The acquisition of Aris Water Solutions strengthens WES's market position and operational capabilities, offering synergies and expanding its service offerings in a key region.

Cash Flow Generation

Strong cash flow generation supports WES's ability to fund growth initiatives, maintain distributions, and manage debt, ensuring long-term financial stability.

Fee-Based Revenue Model

A fee-based revenue model insulates WES from commodity price volatility, ensuring predictable cash flows and supporting consistent financial performance.

Negative Factors

Throughput Declines

Decreased throughput in crude oil and NGLs could impact revenue and operational efficiency, posing a challenge to maintaining growth momentum.

Powder River Basin Challenges

Challenges in the Powder River Basin may hinder WES's ability to capitalize on growth opportunities, affecting its overall market presence and revenue potential.

Cost Pressures

Rising cost pressures could erode margins, impacting profitability and limiting the company's ability to invest in growth and innovation.

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 natural gas; gathering, stabilizing, and transporting condensate, natural gas liquids (NGLs), and crude oil; and gathering and disposing produced water. It also buys and sells natural gas, NGLs, and condensate. The company operates assets located in Texas, New Mexico, the Rocky Mountains, and North-central Pennsylvania. Western Midstream Holdings, LLC operates as the general partner of the company. The company was formerly known as Western Gas Equity Partners, LP and changed its name to Western Midstream Partners, LP in February 2019. Western Midstream Partners, LP was incorporated in 2007 and is based in The Woodlands, Texas.

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, transportation fees from crude oil pipelines, and storage fees. The company benefits from long-term contractual arrangements with various producers, ensuring a predictable revenue base. Additionally, WES may engage in joint ventures or partnerships with other energy companies, enhancing its operational capabilities and expanding its market reach, which further contributes to its earnings.

Western Midstream Partners Financial Statement Overview

Summary

Western Midstream Partners shows strong financial health with high profitability margins and improved leverage. The company maintains efficient operations and cash flow management, positioning it well for future growth. However, slight cost pressures are noted.

Income Statement

Western Midstream Partners demonstrates strong profitability with a high gross profit margin of 77.24% and a solid net profit margin of 35.18% for TTM. Revenue growth is positive, albeit modest at 1.88% TTM, indicating stability in revenue generation. EBIT and EBITDA margins are robust, reflecting efficient operations. However, the slight decline in EBIT margin from the previous year suggests potential cost pressures.

Balance Sheet

The company's balance sheet shows a significant improvement in leverage, with a debt-to-equity ratio dropping to 0.0039 TTM from over 2 in previous years, indicating reduced financial risk. Return on equity remains strong at 39.60%, showcasing effective use of equity capital. However, the equity ratio is not explicitly provided, which could offer additional insights into asset financing.

Cash Flow

Cash flow analysis reveals a healthy free cash flow growth rate of 13.17% TTM, indicating strong cash generation capabilities. The operating cash flow to net income ratio of 3.39 suggests efficient cash conversion, while the free cash flow to net income ratio of 0.82 reflects solid cash retention. These metrics highlight the company's ability to generate and manage cash effectively.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.74B	3.61B	3.11B	3.25B	2.88B	2.77B
Gross Profit	2.85B	2.78B	2.34B	2.25B	2.00B	2.09B
EBITDA	2.42B	2.64B	1.99B	2.16B	1.85B	1.38B
Net Income	1.32B	1.57B	1.02B	1.22B	916.29M	527.01M
Balance Sheet
Total Assets	12.13B	13.14B	12.47B	11.27B	11.27B	11.83B
Cash, Cash Equivalents and Short-Term Investments	177.29M	1.09B	272.79M	286.66M	202.00M	444.92M
Total Debt	7.00B	8.14B	7.96B	6.83B	6.95B	7.89B
Total Liabilities	8.80B	9.77B	9.44B	8.16B	8.18B	8.93B
Stockholders Equity	3.18B	3.24B	2.90B	2.97B	2.96B	2.76B
Cash Flow
Free Cash Flow	1.47B	1.27B	913.12M	1.21B	1.45B	1.22B
Operating Cash Flow	2.22B	2.11B	1.65B	1.70B	1.77B	1.64B
Investing Cash Flow	-724.90M	-39.17M	-1.61B	-218.24M	-257.54M	-448.25M
Financing Cash Flow	-2.44B	-1.25B	-58.83M	-1.40B	-1.75B	-871.98M

Western Midstream Partners Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 39.13
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WES, the sentiment is Positive. The current price of 39.13 is below the 20-day moving average (MA) of 39.26, above the 50-day MA of 38.58, and above the 200-day MA of 37.46, indicating a bullish trend. The MACD of 0.19 indicates Positive momentum. The RSI at 56.12 is Neutral, neither overbought nor oversold. The STOCH value of 75.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WES.

Western Midstream Partners Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WES	80 Outperform	$16.14B	11.71	40.29%	9.13%	5.81%	-13.58%
PAA	79 Outperform	$12.52B	14.38	9.78%	8.54%	-7.53%	9.74%
AM	78 Outperform	$8.52B	18.33	22.52%	4.98%	8.70%	21.42%
DTM	78 Outperform	$12.26B	30.57	9.04%	2.70%	20.39%	-3.85%
HESM	77 Outperform	$7.16B	12.25	59.81%	8.45%	10.78%	19.10%
PAGP	72 Outperform	$14.38B	21.55	10.33%	8.03%	-7.53%	11.27%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%

Western Midstream Partners Corporate Events

Western Midstream Partners Completes $1.2 Billion Senior Notes Offering

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 partnership purposes, including capital expenditures. This financial move is expected to strengthen the company’s financial position and support its strategic initiatives, such as the acquisition of Aris Water Solutions, Inc.

Western Midstream Completes Aris Water Solutions Acquisition

On October 15, 2025, Western Midstream Partners completed its acquisition of Aris Water Solutions, marking a significant expansion in the Delaware Basin. This merger positions WES as a leading integrated water solutions provider, enhancing its capabilities in produced-water gathering, recycling, transportation, disposal, and beneficial reuse. The merger consideration involved a mix of cash and common units, with Aris securityholders receiving approximately 28% in cash and 72% in common units. The acquisition is expected to strengthen WES’s market position and operational agility, benefiting its producer customers in Texas and New Mexico.