HESM

Hess Midstream remains a strong buy, offering a secure 7.9% yield and robust distribution growth, underpinned by long-term minimum volume commitments with Chevron. HESM's fee-based revenue model, protected by contracts through 2033, insulates cash flow from oil price volatility and supports at least 5% annual distribution growth through 2028. Leverage is healthy at 3.1x, with a path to 2.5x by 2028, enabling debt reduction, buybacks, and optionality for M&A or further capital returns.

Hess Midstream beat Q2 earnings expectations despite lower throughput, as higher tariffs and lower costs offset weaker volumes ahead of rising second-half spending.

Hess Midstream's rising free cash flow and lower capital spending support stronger returns, while flat volumes and near-median valuation temper its growth outlook.

Hess Midstream stock remains stagnant due to uncertainty around Chevron's Bakken acreage strategy. Chevron is evaluating the profitability of the Bakken assets; until a clear, positive outcome emerges, HESM's long-term value remains uncertain. Second quarter results showed slightly lower EBITDA and net income, but free cash flow improved due to reduced capital expenditures.

Hess Midstream (HESM) remains a compelling Buy, offering a 7.93% forward yield and the sector's cheapest EV/EBITDA multiple. Q2 2026 saw earnings and free cash flow growth, margin expansion to 85%, and another distribution increase, reaffirming robust income stability. Management reaffirmed full-year guidance, targets 5% annual distribution growth through 2028, and is on track to reduce leverage to 2.5x by 2028.

Brian, a caller from Pennsylvania, phoned in to Mad Money on August 13, 2026 with a stock his son had been researching.

Income investors have plenty of high-yield options, but very few pass the coverage test.

Hess Midstream Partners NYSE: HESM reported higher second-quarter net income and adjusted EBITDA, supported by lower operating expenses and general and administrative savings, while reaffirming its full-year financial outlook and plans for shareholder returns and debt reduction.

Hess Midstream LP (HESM) Q2 2026 Earnings Call Transcript

The midstream energy sector continues to demonstrate its commitment to returning capital to shareholders. Major energy infrastructure companies recently announced sequential increases in payouts during Q3 2026, bolstering income generation across the space.