Hess Midstream LP owns and (HESM) Stock Forecast: What Could Drive It in 2026
Last updated July 2026
Short answer
What is actually driving Hess Midstream LP owns and (HESM) right now is Fee-based, contracted cash flow: Nearly all revenue comes from long-term, fixed-fee contracts with minimum-volume commitments, which smooths cash flow across commodity cycles. Revenue (TTM) is ~$1.55B. If that keeps playing out, the setup is favourable; the risk to it is hESM carries significant concentration risk: growth depends almost entirely on drilling activity in a single basin (the Bakken) served by a single anchor customer (now Chevron). No one can predict where HESM trades, and Walnut does not publish targets, so treat this as a scenario, not a price target or prediction.
What could drive Hess Midstream LP owns and (HESM) higher?
1. Fee-based, contracted cash flow
Nearly all revenue comes from long-term, fixed-fee contracts with minimum-volume commitments, which smooths cash flow across commodity cycles. This underpins the distribution and gives management visibility into multi-year free cash flow. It is the core reason the units trade as an income vehicle.
2. Return of capital
HESM targets at least 5% annual distribution growth through 2028 and has raised its payout for eight straight years, reaching roughly $0.78 per Class A share quarterly in Q1 2026. It also returns excess free cash flow via buybacks, including recurring accretive repurchases of Class A shares and Class B units from its sponsor. Guidance points to roughly $1 billion of excess free cash flow available for returns.
3. Low capital intensity and free cash flow harvest
With 2026 capital expenditures guided to only about $105 million against adjusted EBITDA of roughly $1.25 billion, the business generates substantial free cash flow. Adjusted free cash flow guidance sits in the high hundreds of millions to near $960 million for 2026. This supports both the growing distribution and continued buybacks.
4. Chevron sponsorship transition
Chevron completed its acquisition of Hess in July 2026, replacing Hess Corporation as HESM's anchor customer and sponsor (Global Infrastructure Partners fully exited earlier in 2026). A larger, well-capitalized parent could support Bakken development, though it also concentrates counterparty exposure in one major. Some analysts view HESM as a potential future consolidation target.
What could weigh on HESM?
HESM carries significant concentration risk: growth depends almost entirely on drilling activity in a single basin (the Bakken) served by a single anchor customer (now Chevron). Chevron's decision to cut Bakken rigs from three to two has already weighed on volume expectations and guidance. As a limited partnership it issues a Schedule K-1 and has tax and structural considerations that differ from a standard corporation. It also lacks the diversified export and energy-transition exposure of larger midstream peers, and rising leverage or a distribution policy change would directly affect the income thesis. A Morgan Stanley downgrade and sponsor-transition concerns have added to sentiment risk.
Where HESM trades today
A forecast starts from where the stock actually is. These are HESM's current figures, not a projection: the drivers and risks above are what would move them.
Snapshot for HESM as of July 2026, sourced from Yahoo Finance and may be delayed. Valuation figures move with price and earnings; verify the current numbers with your broker before deciding.
How to think about a HESM forecast
Rather than chasing a price target, it tends to help to weigh the drivers above against the risks, decide how long you are willing to hold, and size the position so a wrong call is survivable. A “forecast” is really a probability-weighted view of those drivers playing out, not a number.
For the full picture, see the HESM guide and whether HESM is a buy. In Walnut you can pressure-test the thesis against your real portfolio.
The bottom line on the HESM outlook
The bottom line: what is driving Hess Midstream LP owns and (HESM) is Fee-based, contracted cash flow, with revenue (ttm) at ~$1.55B. If that keeps playing out the setup is favourable; the risk is hESM carries significant concentration risk: growth depends almost entirely on drilling activity in a single basin (the Bakken) served by a single anchor customer (now Chevron). No one can predict the price, so treat any HESM forecast as a scenario, not a target or prediction, and decide from your own thesis and time horizon. Walnut is not an investment adviser.
More on HESM
- HESM stock guide (what the company does, ETFs that hold it, similar stocks, and the themes it fits)
- Is HESM a buy? (the case for, the risks, and a framework to decide)
- Does HESM pay a dividend?
Build a basket around HESM with Walnut
Use Hess Midstream LP owns and as one constituent in a thematic basket Walnut's AI helps you assemble. Describe a thesis you believe in, the AI proposes the holdings and weights, and you approve before any broker order.
FAQ
What is the forecast for Hess Midstream LP owns and (HESM)?
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No one can reliably predict where HESM will trade, and Walnut does not publish price targets. What is more useful is the setup: the drivers that could push Hess Midstream LP owns and higher and the risks that could weigh on it. This page lays out both so you can form your own view. Not a recommendation.
What could drive HESM higher?
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The main growth drivers are Fee-based, contracted cash flow; Return of capital; Low capital intensity and free cash flow harvest. Whether they play out is the real question, not a guaranteed path.
What are the risks to HESM?
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HESM carries significant concentration risk: growth depends almost entirely on drilling activity in a single basin (the Bakken) served by a single anchor customer (now Chevron). Chevron's decision to cut Bakken rigs from three to two has already weighed on volume expectations and guidance. As a limited partnership it issues a Schedule K-1 and has tax and structural considerations that differ from a standard corporation. It also lacks the diversified export and energy-transition exposure of larger midstream peers, and rising leverage or a distribution policy change would directly affect the income thesis. A Morgan Stanley downgrade and sponsor-transition concerns have added to sentiment risk.
Will HESM stock go up in 2026?
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Nobody knows, and anyone who says they do is guessing. Hess Midstream LP owns and's direction depends on whether the drivers above outweigh the risks, plus the broader market. Focus on the thesis and your time horizon rather than a single-year call.
Is HESM a buy?
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That depends on your thesis, time horizon, and what you already own, not on a forecast. See the HESM "is it a buy?" page for a framework. Walnut is not an investment adviser.
How did HESM perform in Q1 2026?
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First-quarter 2026 revenue was about $390 million with adjusted EBITDA near $300 million, despite severe winter weather. The partnership also repurchased Class A shares and Class B units and raised its quarterly distribution.
Walnut is informational, not investment advice. This page describes drivers and risks; it is not a price forecast, target, or recommendation. Markets are uncertain and past performance does not predict future results.