Start here if you're new
what it is
Hess Midstream runs pipes, plants, and water gear for oil and gas wells in North Dakota.
how it gets paid
Last year Hess Midstream made $1.6B in revenue. Natural gas gathering was the main engine at $0.82B, or 51% of sales.
why it's growing
Revenue grew 8.4% last year on the $1.6B bridge. Ignore stray +189% vs. prior year lines — they did not match the annual total on this page.
what just happened
Latest quarter revenue is about one-fourth of the ~$1.6B annual base (~$400M pace), not $1.2B. EPS $0.72 matched the estimate — an inline print, not a beat.
At a glance
B+ balance sheet — decent shape, but not bulletproof
95/100 earnings predictability — you can trust these numbers
12.7x trailing p/e — the market's not buying it — or you found a deal
8.8% dividend yield — cash in your pocket every quarter
17.5% return on capital — nothing to write home about
xvary composite: 66/100 — average
What they do
Hess Midstream runs pipes, plants, and water gear for oil and gas wells in North Dakota.
Your pipes sit in the Bakken, where switching is costly and slow. Hess Corp. supplied 100% of revenue from 2019 to 2024, and Chevron now controls Hess. Operating margin (profit left after running costs) was 62.2%, so 62 cents stayed from every sales dollar.
How they make money
$1.6B
annual revenue · their business grew +8.4% last year
Natural gas gathering
$0.82B
Natural gas processing
$0.46B
Crude oil gathering
$0.18B
Water handling
$0.09B
Other midstream services
$0.05B
The products that matter
moves and processes bakken volumes
bakken midstream system
$1.6B · entire reported revenue base
it's the full $1.6B business here. the snapshot data doesn't split revenue by asset, which tells you something important: you're buying one integrated cash-flow machine, not a collection of separate segments.
single-system economics
Key numbers
8.8%
dividend yield
You get 8.8 cents a year for each $1 invested, if the payout holds.
12.7x
trailing p/e
You are paying 12.7 years of last year's earnings, so the market is pricing stability.
62.2%
operating margin
For every $1 of sales, 62 cents stays after running costs.
$3.8B
long-term debt
That is the bill sitting behind the 8.8% yield.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 75 / 100
- long-term debt $3.8B (44% of capital)
- net profit margin 21.1% — keeps 21 cents of every dollar in revenue
- return on equity 86% — $0.86 profit for every $1 investors have put in
B+ — net profit margin looks solid but long-term debt needs watching.
Total return vs. market
You invested $10,000 in HESM 3 years ago → it's now worth $15,960.
The index would have given you $13,880.
source: institutional data · total return
What just happened
met estimates
EPS landed on the $0.72 estimate; quarter revenue is ~$400M pace versus $1.6B annual — not $1.2B or +189% vs. prior year.
Full-year revenue growth on the bridge is +8.4% vs. prior year. The +189% and $1.2B lines were bad merges against that math.
~$400M
quarter revenue (approx.)
$0.72
eps (inline)
+8.4%
annual rev. growth
the number that mattered
+8.4% vs. prior year on the $1.6B revenue bridge is the coherent growth read — customer concentration still matters, but the old 189% story was noise.
-
hess midstream plans on pursuing a much more conservative construction policy.last year, the company announced that it reduced its rig count from four to three in the bakken shale.
-
also, in december, when providing guidance, leadership stated that it planned on cutting future capital expenditures.
-
in the fourth quarter, spending here dropped 44%.moreover, in 2026, outlays are expected to be $150 million, or about $100 million less than the 2025 budget.
-
in 2027 and 2028, this figure is projected to decline further to just $75 million each year.
-
external financing will most likely no longer be needed.because the company was spending so heavily in the past, it had to rely heavily on debt and a steady issuance of new common stock to fund these activities.
source: company earnings report, 2026
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What could go wrong
the #1 risk here is chevron cutting bakken activity. hess midstream gets paid on one system, by one customer, in one basin.
high
single-customer concentration
chevron accounts for 100% of revenue. there is no diversification cushion if drilling, completions, or throughput plans change.
a 10% hit to volumes implies roughly $160M of revenue exposure against a $1.6B annual base.
high
bakken concentration
this is not a national pipeline network. it's a bakken-linked asset set. if chevron shifts capital to other fields, your midstream volumes do not magically relocate.
one basin drives essentially the whole business, so operational concentration sits on top of customer concentration.
med
leverage still matters
the company carries $3.8B in long-term debt, equal to 44% of capital. that works fine when volumes are steady. it matters a lot more if they are not.
debt limits flexibility and makes any cash-flow wobble more painful for equity holders.
med
growth is slowing by design
capital spending is being cut to $150M in 2026, then to $75M in 2027 and 2028. that supports free cash flow, but it also lowers the odds of a fresh growth narrative.
if investors stop paying for the dividend and start asking for growth, the valuation case gets thinner fast.
100% of revenue comes from one customer, and the balance sheet carries $3.8B of long-term debt. that's stable until chevron decides it isn't.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
the capex reset
q4 spending fell 44%. 2026 is guided to $150M, then $75M in both 2027 and 2028. that's the clearest sign the business is shifting from buildout to cash harvest.
risk
chevron's bakken plan
your biggest variable sits outside hess midstream. if chevron keeps activity steady, the yield story holds. if it trims harder, the whole model feels it.
calendar
the next guidance update
the next time management updates capex, volumes, or distribution expectations matters more than a small EPS beat. this stock trades on visibility.
trend
buyers are showing up, the chart is not
institutions have been net buyers for three straight quarters, but momentum still ranks below average. someone likes the yield. the tape is less impressed.
Analyst rankings
short-term outlook
top 20%
outlook rank 2 — analysts expect above-average price performance in the year ahead. in human-speak: they like the setup more than the stock chart suggests.
risk profile
average
risk rank 3 — this sits near the middle of the pack. not a widow-maker, not a sleep-easy utility either.
chart momentum
below average
momentum rank 4 — analysts see weaker near-term price action. the income story is stronger than the tape.
earnings predictability
95 / 100
management's numbers are unusually steady. for a stock with one customer, that consistency matters more than it usually would.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 134 buyers vs. 127 sellers in 3q2025. total institutional holdings: 0.1B shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$24
$43
$36
current price
$34
target midpoint · 6% from current · 3-5yr high: $70 (+95% · 24% ann'l return)
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