Results: Hess Midstream LP Exceeded Expectations And The Consensus Has Updated Its Estimates
Hess Midstream LP (NYSE:HESM) came out with its third-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. The result was positive overall - although revenues of US$421m were in line with what the analysts predicted, Hess Midstream surprised by delivering a statutory profit of US$0.75 per share, modestly greater than expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Hess Midstream after the latest results.
After the latest results, the six analysts covering Hess Midstream are now predicting revenues of US$1.66b in 2026. If met, this would reflect a reasonable 2.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to ascend 12% to US$2.81. Before this earnings report, the analysts had been forecasting revenues of US$1.66b and earnings per share (EPS) of US$2.79 in 2026. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
See our latest analysis for Hess Midstream
With no major changes to earnings forecasts, the consensus price target fell 7.5% to US$37.00, suggesting that the analysts might have previously been hoping for an earnings upgrade. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Hess Midstream, with the most bullish analyst valuing it at US$40.00 and the most bearish at US$34.00 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Hess Midstream's revenue growth is expected to slow, with the forecast 2.3% annualised growth rate until the end of 2026 being well below the historical 7.9% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 3.2% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Hess Midstream.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Hess Midstream's revenue is expected to perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Hess Midstream's future valuation.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Hess Midstream going out to 2027, and you can see them free on our platform here..
It is also worth noting that we have found 3 warning signs for Hess Midstream that you need to take into consideration.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.