Hess Midstream LPHESM
NYSE•Energy•Oil & Gas Midstream
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.
Hess Midstream LP (HESM) reported trailing twelve months revenue of $1.63B as of March 2026, a 7.1% increase year-over-year. Quarterly revenue reached $390.10M, reflecting continued top-line momentum.
Hess Midstream LP generated $368.90M in TTM net income, with quarterly EBITDA of $296.60M. The operating margin contracted from 62.1% to 61.0%, suggesting rising cost pressures or pricing headwinds.
The spread between operating margin (61.0%) and net margin (22.5%) indicates significant non-operating expenses or interest burden. Net margin has improved from 18.7% a year ago, signaling stronger bottom-line efficiency.
HESM trades at a P/E of 12.9x (below the broader market average) and a P/S of 2.9x. The price-to-book ratio of 12.7x indicates a significant premium over book value.
The company generated $224.50M in free cash flow over the trailing twelve months, a 43.1% increase year-over-year, indicating cash generation ability. The balance sheet shows $4.32B in total assets with $3.74B in long-term debt against $374.80M in stockholders equity for a debt-to-equity ratio of 10.0, a relatively leveraged position. Data based on the most recent quarterly reports.
Competitive analysis based on 21 quarters of fundamental data
Operating margins are stable at ~61.6%, suggesting durable pricing power and cost discipline.
Consistently high ROE averaging 61.9% suggests a durable competitive advantage and efficient capital allocation.
Free cash flow is consistently positive and growing — a hallmark of a capital-light business that can self-fund growth.
TTM revenue has grown consistently (7 of 7 quarters up), with ~13.1% growth over the period. Strong demand durability.
Data-driven red flags and warnings across 21 quarters
Margins are stable or improving at ~61.9% — no sign of cost or pricing stress.
FCF covers net income by 2.5x on average — earnings are well-supported by cash generation.
D/E ratio is 10.0 — dangerously high. The company is heavily leveraged and vulnerable to rising rates or cash flow dips.
Revenue is stable or growing over recent quarters — demand appears durable.
Free cash flow is consistently positive — the business self-funds without external capital reliance.
Shares outstanding increased 54.2% — significant dilution, likely from stock compensation or capital raises.