Hess Midstream is a high-quality midstream business with strong margins and excellent free cash flow conversion that has beaten earnings estimates in each of the last four quarters; however, momentum weakness, analyst target exhaustion, and heavy customer and geographic concentration make the current setup better suited for existing holders than new buyers.
Thesis pillars
- Perfect Earnings Beat Streak→Stable
- High Quality Fundamentals→Stable
- Momentum Weakness Near Term Headwind→Stable
- +1 more pillar — see the Why tab for full reasoning
Hess Midstream LP (HESM) Stock Analysis
Range Bound setup · Catalyst-Driven edge
Energy · Oil & Gas Midstream
Sell if holding. At $38.16, A.R:R is negative (-2.7) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Concentration risk — Customer: Chevron; Concentration risk — Geographic: Bakken.
Hess Midstream LP acquires, owns, operates, and develops midstream assets and provide fee-based services to sponsor, its subsidiaries, and third-party customers in the United States. It operates through three segments: Gathering; Processing and Storage; and Terminaling and... Read more
Sell if holding. At $38.16, A.R:R is negative (-2.7) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Concentration risk — Customer: Chevron; Concentration risk — Geographic: Bakken. Chart setup: RSI 46 mid-range, Bollinger mid-band. Score 5.4/10, high confidence.
Passes 7/8 gates (positive momentum, clean insider activity, no SEC red flags, news events none recent, earnings proximity 25d clear, semi cycle peak clear, materials cycle peak clear). Fails on favorable risk/reward ratio. Suitability: moderate.
About Hess Midstream LP
About Hess Midstream LP
Hess Midstream LP concentrates substantially all of its assets in North Dakota's Bakken formation, providing gathering, compressing, processing, fractionating, terminaling, storing, and transporting services for crude oil, natural gas, and NGLs. The partnership generates substantially all revenues through fee-based commercial agreements with Chevron — which acquired Hess Corporation in a merger that closed July 18, 2025 — and carries $1.4 billion in credit facilities consisting of a $1.0 billion revolving credit facility and a fully drawn $400.0 million Term Loan A.
The company generates revenue from volumes of crude oil, natural gas, and NGLs handled under fee-based agreements rather than from commodity prices, providing minimal direct price exposure during the initial commercial agreement term. This term includes an annual fee recalculation mechanism targeting a return on deployed capital; a secondary term shifts to an inflation-based structure that may provide less downside protection. At the Tioga Rail Terminal, HESM employs third-party contract operators under a rail and transload services agreement terminable on 90 days' notice, with liability for losses unless caused by operator negligence. The company has historically provided midstream services to third parties on only a limited basis; its natural gas and crude oil gathering systems compete with third-party systems in the Bakken, while terminals and crude oil rail cars compete with third-party infrastructure for available volumes. Produced water disposal services represent a supplemental revenue stream that depends on Chevron's continued drilling activity, independent of other midstream services.
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Chevron's control over Bakken drilling and production decisions means any portfolio shift — such as reallocating capital following the 2025 acquisition integration — could reduce throughput volumes without HESM holding direct contractual recourse beyond force majeure and material-breach cure periods. Cash flows from existing wells decline over time as production naturally falls, making Chevron's replacement drilling the principal driver of distribution sustainability. Third-party revenue diversification faces additional headwinds: potential customers may prefer arrangements that expose HESM to direct commodity price risk, which the company aims to avoid under its fee-based model.
See also: Energy · Oil & Gas Midstream
From Hess Midstream LP's most recent 10-K filing, extracted June 10, 2026.
Recent developments
updated 2026-07-06Recent Developments — Hess Midstream LP
Latest news
- NEWS Analysts Diverge on Hess Midstream Following Sector Valuation Shifts - HarianBasis.co — HarianBasis.co neutral
- NEWS Why Cushing Sold Out of Hess Midstream LP -- and What It Means for Investors - The Motley Fool — The Motley Fool negative
- NEWS Hess Midstream Partners LP (NYSE:HESM) Plans Dividend Increase - $0.78 Per Share - MarketBeat — MarketBeat positive
- NEWS HESM (Hess Midstream LP) dips 0.8% after Q4 2025 minor EPS miss even as revenue rises 8.4% year over year. - Shared Trad — Xã Vĩnh Công negative
- NEWS Three Days Left To Buy Hess Midstream LP (NYSE:HESM) Before The Ex-Dividend Date - Yahoo Finance — Yahoo Finance neutral
Generated 2026-07-06T05:40:27Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHCustomerChevron10-K Item 1A: 'Chevron currently accounts for substantially all of our revenues.'
- HIGHGeographicBakken10-K Item 1A: 'Substantially all of our assets are located in the Bakken'
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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Rating Breakdown
2 floor-breakers
Growth below the gate floor. Component breakdown shows what dragged the score down.static
Ranks in the bottom of its industry peers on the composite signal. Better names in the same sector exist.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. At $38.16, A.R:R is negative (-2.7) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Concentration risk — Customer: Chevron; Concentration risk — Geographic: Bakken. Chart setup: RSI 46 mid-range, Bollinger mid-band. Prior stop was $36.66. Score 5.4/10, high confidence.
Take-profit target: $38.53 (+1.0% upside). Prior stop was $36.66. Stop-loss: $36.66.
Concentration risk — Customer: Chevron; Concentration risk — Geographic: Bakken; Analyst target reached - limited upside remaining.
Hess Midstream LP trades at a P/E of 13.2 (forward 12.5). TrendMatrix value score: 6.2/10. Verdict: Sell.
12 analysts cover HESM with a consensus score of 2.5/5. Average price target: $37.
What does Hess Midstream LP do?Hess Midstream LP acquires, owns, operates, and develops midstream assets and provide fee-based services to sponsor,...
Hess Midstream LP acquires, owns, operates, and develops midstream assets and provide fee-based services to sponsor, its subsidiaries, and third-party customers in the United States. It operates through three segments: Gathering; Processing and Storage; and Terminaling and Export. The Gathering segment owns natural gas gathering and compression systems; crude oil gathering systems; and produced water gathering and disposal facilities. Its gathering system consists of approximately 1,430 miles of high- and low-pressure natural gas and natural gas liquids gathering pipelines with capacity of approximately 685 million cubic feet per day; crude oil gathering system comprises approximately 615 miles of crude oil gathering pipelines; and produces water gathering system that includes approximately 360 miles of pipelines in gathering systems. The Processing and Storage segment comprises Tioga Gas Plant, a natural gas processing and fractionation plant located in Tioga, North Dakota; Mentor Storage Terminal, a propane storage cavern and rail, and truck loading and unloading facility located in Mentor, Minnesota; and Terminaling and Export segment that owns Ramberg terminal facility, the Tioga rail terminal, crude oil rail cars, and other Dakota access pipeline connections, as well as Johnson's Corner Header System, a crude oil pipeline header system; and other DAPL connections. Hess Midstream LP was formerly known as Hess Midstream Partners LP and changed its name to Hess Midstream LP in December 2019. Hess Midstream LP was founded in 2014 and is based in Houston, Texas.