Hess Midstream Partners LP (HESM) Earnings & Analysis

Latest quarter

For the later quarter ended September 30, Hess Midstream’s revenue as counted by the consensus was $410.1 million, above the $401.7 million consensus estimate. Adjusted EPS was $0.77, above the $0.71 estimate.

For Q2 FY2026, Hess Midstream reported revenue of $399.0 million, down from $414.2 million a year earlier. The filing attributed the decline primarily to lower throughput volumes, partly offset by higher tariff rates and third-party services. Diluted EPS was $0.75, compared with $0.74 a year earlier.

The filing said oil terminaling and water gathering volumes fell 15% and 12%, respectively, primarily because lower new-well activity reduced production. Gas processing volumes fell 4%, primarily because of planned maintenance at the Tioga Gas Plant.

Hess Midstream reported an operating margin of 63.5%, compared with 62.8% a year earlier, and free cash flow of $255.5 million, compared with $213.5 million. The filing said operating costs and expenses fell to $145.8 million from $154.0 million, primarily because of lower employee and maintenance costs.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

Hess Midstream’s latest earnings call was not available for review. In its filing, the company said most of its systems had entered the secondary term of their commercial agreements, with fixed fees adjusted annually for inflation up to 3% a year. The company said the structure may provide less downside protection than the previous fee structure, while MVCs will continue to provide downside protection through 2033.

Guidance

Hess Midstream targets annualized distribution growth per Class A share of 5% in the fourth quarter of 2026. For 2027, it expects to maintain quarterly distributions at the expected fourth-quarter 2026 level and intends to maintain at least that level thereafter, funded by adjusted free cash flow.