Western Midstream Partners (WES) AI Stock Analysis

• Market Cap: $16.76B
• Dividend Yield: 9.13%
• Average Volume (3M): 1.06M
• Price to Earnings (P/E): 11.9
• 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: 1,522,916
• 30 Day Avg. Volume: 1,055,055
• 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: 1.41
• Enterprise Value/Revenue: 6.30
• Enterprise Value/Gross Profit: 8.28
• Enterprise Value/Ebitda: 9.76
• 1Y Price Target: $40.75
• Price Target Upside: -0.80% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 4
• EPS Forecast (FY): 3.65
• Revenue Forecast (FY): $4.11B

• Rating: 78 Outperform
• Price Target: $46.00 ▲(11.98% Upside)

The score is driven primarily by strong financial performance (high margins, improving leverage, and healthy cash generation). Valuation is supportive with an 8.90% dividend yield and moderate P/E, while technicals indicate a stable uptrend but neutral momentum. Earnings call takeaways were positive overall, tempered by throughput and margin headwinds in certain basins.

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

Strong profitability (TTM gross margin 77.24%, net margin 35.18%) and solid cash generation (TTM free cash flow growth 13.17%; operating cash flow to net income 3.39). Balance sheet risk has improved meaningfully with sharply lower leverage (debt-to-equity 0.0039 TTM), though modest revenue growth (1.88% TTM) and slight EBIT margin decline indicate some cost/pressure risk.

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: 41.08
• 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 41.08 is above the 20-day moving average (MA) of 40.26, above the 50-day MA of 39.16, and above the 200-day MA of 37.16, indicating a bullish trend. The MACD of 0.41 indicates Positive momentum. The RSI at 62.91 is Neutral, neither overbought nor oversold. The STOCH value of 36.30 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
HESM	79 Outperform	$7.49B	12.29	―	8.45%	10.78%	19.10%
DTM	79 Outperform	$12.85B	32.31	9.04%	2.70%	20.39%	-3.85%
PAA	79 Outperform	$13.97B	15.92	9.78%	8.54%	-7.53%	9.74%
WES	78 Outperform	$16.76B	11.92	40.29%	9.13%	5.81%	-13.58%
AM	74 Outperform	$8.93B	19.10	22.52%	4.98%	8.70%	21.42%
PAGP	72 Outperform	$16.07B	24.10	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 Amends Key Gas Agreements, Redeems Units

On January 16, 2026, Western Midstream subsidiary Delaware Basin Midstream LLC amended its Delaware Basin gas gathering agreement with Occidental Petroleum’s Anadarko E&P Onshore LLC, shifting from a cost-of-service to a fixed-fee structure, adding new minimum volume commitments through 2027, and revising acreage transfer terms, while also entering related natural gas gathering and processing arrangements with a ConocoPhillips subsidiary. In connection with these changes, Western Midstream agreed to redeem 15.3 million of its common units from Occidental on February 3, 2026—reducing Occidental’s ownership stake—and structured the reset of Delaware Basin natural gas fees and new fixed-fee contracts so that lower operating cash flows over time are expected to be largely offset by distribution savings and recognition of contract liability revenue through 2032, further diversifying revenues, reducing related-party exposure, and advancing Western Midstream’s transition toward a more transparent, standalone fixed-fee midstream model with leverage targeted around 3.0x Adjusted EBITDA in 2026.

The most recent analyst rating on (WES) stock is a Hold with a $39.00 price target. To see the full list of analyst forecasts on Western Midstream Partners stock, see the WES Stock Forecast page.

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.

The most recent analyst rating on (WES) stock is a Hold with a $42.00 price target. To see the full list of analyst forecasts on Western Midstream Partners stock, see the WES Stock Forecast page.