Western Midstream Partners considers investment in Kinetik Holdings
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Nov 10 2024
0mins
Should l Buy WES?
Source: SeekingAlpha
Western Midstream Partners (WES) experienced a decline of 5.66% as it reached a 20-day high amid broader market weakness, with the Nasdaq-100 down 0.19% and the S&P 500 down 0.16%.
The recent news indicates that Western Midstream Partners is considering a takeover bid for Kinetik Holdings, which is backed by Occidental Petroleum. This potential investment reflects a strategic move in the energy sector, aiming to enhance growth opportunities and market positioning.
This development could have significant implications for Western Midstream, as it seeks to expand its portfolio and leverage the growing demand in the energy market.
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Analyst Views on WES
Wall Street analysts forecast WES stock price to rise
4 Analyst Rating
0 Buy
4 Hold
0 Sell
Hold
Current: 40.090
Low
39.00
Averages
40.50
High
42.00
Current: 40.090
Low
39.00
Averages
40.50
High
42.00
About WES
Western Midstream Partners, LP acquires, owns, develops and operates midstream assets. It is engaged in the business of gathering, compressing, treating, processing, and transporting natural gas, gathering, stabilizing, and transporting condensate, natural gas liquids (NGLs), and crude oil, and gathering and disposing of produced water. Its core assets provide services for customers in the Delaware Basin in West Texas and New Mexico, and the DJ Basin in northeastern Colorado, and the Powder River Basin in Northeast Wyoming. Additional assets and investments are in South Texas, Utah, and Southwest Wyoming. In its capacity as a natural gas processor, the Company also buys and sells natural gas, NGLs, and condensate on its behalf and its customers under certain gas processing contracts. Its subsidiaries include Western Midstream Operating GP, LLC, Western Midstream Services, LLC, Western Midstream Services Holdings, LLC, Western Midstream Operating, LP, and Aris Water Solutions, Inc.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Energy Midstream Stocks Offer Stable Income
- Energy Transition Potential: Energy Transfer (ET) currently boasts a 7.1% dividend yield and plans to increase distributions by 3% to 5% moving forward, leveraging its extensive midstream operations and stable fee-based business to provide long-term passive income for investors.
- Consistent Growth Performance: Enterprise Products Partners (EPD) has increased its distribution for 27 consecutive years, with a current yield of 5.9%, and is projected to achieve double-digit growth in adjusted EBITDA and cash flow by 2027, demonstrating its reliability and resilience in uncertain markets.
- High Yield Appeal: Western Midstream (WES) offers an 8.6% yield, ranking among the highest in the midstream sector, and while facing some short-term challenges, it expects a 3% increase in distributions in 2026 and maintains financial stability through a restructured fixed-fee agreement with Occidental.
- Strategic Diversification: Western Midstream is actively expanding its footprint in the produced water business through acquisitions like Aris Water Solutions and the Pathfinder Pipeline project, and despite the transition period, it is still poised for adjusted EBITDA growth, enhancing its competitive position in the market.
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- Investor Preference: During turbulent and uncertain market conditions, many investors are turning to dividend-yielding stocks, which typically have high free cash flows and reward shareholders with substantial dividends, indicating a strong desire for stable returns.
- Analyst Ratings: Benzinga provides the latest analyst ratings for three high-yielding energy stocks, including Kimbell Royalty Partners LP, Evolution Petroleum Corp, and Western Midstream Partners LP, assisting investors in making more informed decisions.
- Market Data: Benzinga's Analyst Ratings page allows traders to sort through a comprehensive database by analyst accuracy, enhancing investors' understanding and responsiveness to market dynamics.
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- AGNC Investment Returns: With a dividend yield of 12.6%, investing $1,000 in AGNC generates $125.80 in annual income, showcasing its strength in low-risk fixed-income investments, and it is expected to continue paying high dividends.
- Ares Capital Growth Potential: Ares Capital offers a 10% dividend yield, providing $100.30 in annual income from a $1,000 investment, and with a $29.5 billion portfolio and stable earnings, it is likely to maintain its 16-year record of stable dividend payments.
- Western Midstream Cash Flow: With an 8.9% dividend yield, a $1,000 investment in Western Midstream yields $88.60 annually, and last year, its cash flow was sufficient to cover distributions and capital expenditures, indicating future distribution increases.
- Market Appeal: The stable dividend payment records of these three high-yield stocks make them attractive options for investors looking to turn $3,000 into hundreds of dollars in annual passive income, especially in the current market environment.
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High-Yield Stocks Maintain Strong Dividend Performance
- AGNC's Stable Dividends: AGNC Investment has maintained its monthly dividend of 12.6% for over five years, with a 16% return on equity in Q4 2022, ensuring sustainability and attracting income-seeking investors.
- Ares Capital's Growth Potential: As the largest business development company, Ares Capital has delivered stable or increasing dividends for over 16 years, with a weighted average yield of 9.3%, and committed $5.8 billion in new investments last quarter, showcasing strong capital growth capabilities.
- Western Midstream's Cash Flow Advantage: Western Midstream Partners generated enough cash flow last year to cover its distributions and capital expenditures, with $95 million in excess free cash flow enhancing financial flexibility, and plans to achieve a 2.2% distribution increase by 2026 to support future payouts.
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See More
Western Midstream Partners Announces 2025 Earnings and Investor Conference Participation
- Earnings Announcement: Western Midstream Partners will release its full-year and fourth-quarter 2025 earnings before market open, accompanied by a post-earnings interview with CFO Kristen Shults, aimed at providing deeper insights into the company's performance and 2026 outlook to aid investor understanding of future directions.
- Investor Conference Participation: The company plans to participate in several investor conferences during the first and second quarters of 2026, enhancing market transparency regarding its strategies and operations through direct engagement with investors, thereby boosting investor confidence and market recognition.
- Robust Business Model: Western Midstream focuses on developing and operating midstream assets, primarily protecting cash flows through fee-based contracts, which mitigates direct exposure to commodity price volatility and ensures financial stability in uncertain market conditions.
- Extensive Asset Base: The company boasts a wide array of midstream assets across Texas, New Mexico, Colorado, Utah, and Wyoming, covering various segments such as natural gas gathering, processing, and transportation, which strengthens its competitive position and market share in the energy sector.
See More
Western Midstream Partners Announces Investor Conference Participation
- Post-Earnings Interview: Western Midstream Partners will release a post-earnings interview with CFO Kristen Shults on its website before market open, providing insights into its full-year and Q4 2025 results and 2026 outlook, aimed at boosting investor confidence in the company's future.
- Investor Conference Participation: The company plans to participate in several investor conferences in Q1 and Q2 2026, including the Morgan Stanley Energy & Power Conference on March 3 and the US Capital Advisors 15th Annual Midstream Corporate Access Day on April 1, showcasing its strategic positioning in the midstream asset sector.
- Midstream Asset Overview: Western Midstream focuses on developing, acquiring, and operating midstream assets across Texas, New Mexico, Colorado, Utah, and Wyoming, engaging in natural gas gathering, processing, and transportation, with a substantial majority of cash flows protected from commodity price volatility through fee-based contracts.
- Market Outlook: By participating in multiple investor conferences, Western Midstream not only demonstrates transparency in its operations but also aims to strengthen its competitive edge and market trust through enhanced interaction with investors.
See More
Energy Midstream Stocks Offer Stable Income
- Energy Transition Potential: Energy Transfer (ET) currently boasts a 7.1% dividend yield and plans to increase distributions by 3% to 5% moving forward, leveraging its extensive midstream operations and stable fee-based business to provide long-term passive income for investors.
- Consistent Growth Performance: Enterprise Products Partners (EPD) has increased its distribution for 27 consecutive years, with a current yield of 5.9%, and is projected to achieve double-digit growth in adjusted EBITDA and cash flow by 2027, demonstrating its reliability and resilience in uncertain markets.
- High Yield Appeal: Western Midstream (WES) offers an 8.6% yield, ranking among the highest in the midstream sector, and while facing some short-term challenges, it expects a 3% increase in distributions in 2026 and maintains financial stability through a restructured fixed-fee agreement with Occidental.
- Strategic Diversification: Western Midstream is actively expanding its footprint in the produced water business through acquisitions like Aris Water Solutions and the Pathfinder Pipeline project, and despite the transition period, it is still poised for adjusted EBITDA growth, enhancing its competitive position in the market.
See More
Dividend Stocks Gaining Favor Amid Market Turbulence
- Investor Preference: During turbulent and uncertain market conditions, many investors are turning to dividend-yielding stocks, which typically have high free cash flows and reward shareholders with substantial dividends, indicating a strong desire for stable returns.
- Analyst Ratings: Benzinga provides the latest analyst ratings for three high-yielding energy stocks, including Kimbell Royalty Partners LP, Evolution Petroleum Corp, and Western Midstream Partners LP, assisting investors in making more informed decisions.
- Market Data: Benzinga's Analyst Ratings page allows traders to sort through a comprehensive database by analyst accuracy, enhancing investors' understanding and responsiveness to market dynamics.
- Dividend Appeal: High-dividend stocks become particularly attractive in uncertain market environments, as investors seek to secure stable cash flows through these selections, thereby protecting their portfolios amidst market volatility.
See More
High-Yield Stocks Boost Passive Income Potential
- AGNC Investment Returns: With a dividend yield of 12.6%, investing $1,000 in AGNC generates $125.80 in annual income, showcasing its strength in low-risk fixed-income investments, and it is expected to continue paying high dividends.
- Ares Capital Growth Potential: Ares Capital offers a 10% dividend yield, providing $100.30 in annual income from a $1,000 investment, and with a $29.5 billion portfolio and stable earnings, it is likely to maintain its 16-year record of stable dividend payments.
- Western Midstream Cash Flow: With an 8.9% dividend yield, a $1,000 investment in Western Midstream yields $88.60 annually, and last year, its cash flow was sufficient to cover distributions and capital expenditures, indicating future distribution increases.
- Market Appeal: The stable dividend payment records of these three high-yield stocks make them attractive options for investors looking to turn $3,000 into hundreds of dollars in annual passive income, especially in the current market environment.
See More
High-Yield Stocks Maintain Strong Dividend Performance
- AGNC's Stable Dividends: AGNC Investment has maintained its monthly dividend of 12.6% for over five years, with a 16% return on equity in Q4 2022, ensuring sustainability and attracting income-seeking investors.
- Ares Capital's Growth Potential: As the largest business development company, Ares Capital has delivered stable or increasing dividends for over 16 years, with a weighted average yield of 9.3%, and committed $5.8 billion in new investments last quarter, showcasing strong capital growth capabilities.
- Western Midstream's Cash Flow Advantage: Western Midstream Partners generated enough cash flow last year to cover its distributions and capital expenditures, with $95 million in excess free cash flow enhancing financial flexibility, and plans to achieve a 2.2% distribution increase by 2026 to support future payouts.
- Demand for High-Yield Stocks: With the S&P 500's dividend yield at a mere 1.1%, companies like AGNC, Ares, and Western Midstream offer yields above market averages, allowing investors to generate $314.7 in annual passive income from a $3,000 investment, appealing to those seeking high returns.
See More
Western Midstream Partners Announces 2025 Earnings and Investor Conference Participation
- Earnings Announcement: Western Midstream Partners will release its full-year and fourth-quarter 2025 earnings before market open, accompanied by a post-earnings interview with CFO Kristen Shults, aimed at providing deeper insights into the company's performance and 2026 outlook to aid investor understanding of future directions.
- Investor Conference Participation: The company plans to participate in several investor conferences during the first and second quarters of 2026, enhancing market transparency regarding its strategies and operations through direct engagement with investors, thereby boosting investor confidence and market recognition.
- Robust Business Model: Western Midstream focuses on developing and operating midstream assets, primarily protecting cash flows through fee-based contracts, which mitigates direct exposure to commodity price volatility and ensures financial stability in uncertain market conditions.
- Extensive Asset Base: The company boasts a wide array of midstream assets across Texas, New Mexico, Colorado, Utah, and Wyoming, covering various segments such as natural gas gathering, processing, and transportation, which strengthens its competitive position and market share in the energy sector.
See More
Western Midstream Partners Announces Investor Conference Participation
- Post-Earnings Interview: Western Midstream Partners will release a post-earnings interview with CFO Kristen Shults on its website before market open, providing insights into its full-year and Q4 2025 results and 2026 outlook, aimed at boosting investor confidence in the company's future.
- Investor Conference Participation: The company plans to participate in several investor conferences in Q1 and Q2 2026, including the Morgan Stanley Energy & Power Conference on March 3 and the US Capital Advisors 15th Annual Midstream Corporate Access Day on April 1, showcasing its strategic positioning in the midstream asset sector.
- Midstream Asset Overview: Western Midstream focuses on developing, acquiring, and operating midstream assets across Texas, New Mexico, Colorado, Utah, and Wyoming, engaging in natural gas gathering, processing, and transportation, with a substantial majority of cash flows protected from commodity price volatility through fee-based contracts.
- Market Outlook: By participating in multiple investor conferences, Western Midstream not only demonstrates transparency in its operations but also aims to strengthen its competitive edge and market trust through enhanced interaction with investors.
See More
