Results were in line with the updated guidance and the distribution growth trajectory remains intact. The key catalyst is the closing of the Chevron/DJ Basin transaction by year-end 2026, which would transform HESM into a multi-basin independent midstream company. Monitor for closing conditions and any integration updates.
Price Chart
Executive Summary
Adjusted EBITDA was $319.9M and Adjusted Free Cash Flow was $247.9M. The company reiterated its updated full-year 2026 guidance (net income $650-675M, Adjusted EBITDA $1,225-1,250M, Adjusted FCF $910-935M) and increased its quarterly distribution to $0.7985 per share, in line with its 5% annualized growth target. The results are being evaluated in the context of the pending transformative acquisition of Chevron's interest in HESM and DJ Basin assets announced on October 6, 2026.
Key Financial Metrics
Key Facts
- Total revenue was $410.1M, down from $420.9M in Q3 2025, driven by lower throughput volumes partially offset by higher tariff rates.
- Adjusted EBITDA was $319.9M vs $320.7M in Q3 2025; Adjusted Free Cash Flow was $247.9M vs $186.8M in Q3 2025.
- Quarterly cash distribution increased to $0.7985 per Class A share, a $0.0097 increase from Q2 2026, in line with the targeted annual growth of at least 5%.
- Full-year 2026 guidance reiterated: net income $650-675M, Adjusted EBITDA $1,225-1,250M, Adjusted FCF $910-935M.
- Throughput volumes declined YoY: oil terminaling -10%, gas processing -8%, water gathering -4%.
- Capital expenditures were $21.5M, down 73% from $79.8M in Q3 2025, due to completion of gas compression expansion.
- Revolving credit facility drawn balance was $180.0M at September 30, 2026, down from $256.0M at June 30, 2026.
- Pending acquisition of Chevron's interest and DJ Basin assets (announced Oct 6, 2026) expected to close by year-end 2026.
Financial Impact
Q3 2026 net income attributable to HESM of $99.4M ($0.77/share) vs $97.7M ($0.75) YoY; revenue $410.1M vs consensus $404.7M; EPS $0.77 vs consensus $0.71.
Segment Breakdown
| Segment | Revenue | Growth |
|---|---|---|
| Gathering | $217.8M | -4.2% |
| Processing and Storage | $153.1M | -4.1% |
| Terminaling and Export | $39.2M | +15.3% |
Risk Factors
- Continued throughput volume declines due to lower production and new-well activity on Bakken/Three Forks.
- Pending Chevron transaction may not close on anticipated timeline or at all.
- Integration risks associated with acquiring and operating DJ Basin assets.
- Concentration risk from reliance on Chevron as primary customer.
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 6 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001193125-26-439859 |
| Document: hesm-20261030.htm | 0001193125-26-439859 |
| Document: 0001193125-26-439859-index-headers.html | 0001193125-26-439859 |
| Document: 0001193125-26-439859-index.html | 0001193125-26-439859 |
| Document: 0001193125-26-439859.txt | 0001193125-26-439859 |
| 8-K Data (Synthetic) | 0001193125-26-439859 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 30, 2026 2d ago | 8-K | $32.00 | awaiting T+1 | awaiting T+1 | $32.71 (+2.22%) |
Oct 22, 2026 10d ago | SC 13G | $30.04 $30.61 | ▲ +1.90% | ▲ +2.42% | $32.71 (+8.89%) |
Oct 12, 2026 20d ago | Institutional Cluster | $32.37 $31.20 | ▼ −3.61% | ▼ −3.60% | $32.71 (+1.05%) |
Oct 8, 2026 24d ago | SC 13D/A | $32.26 $32.37 | ▲ +0.34% | ▲ +0.40% | $32.71 (+1.39%) |
Oct 8, 2026 24d ago | 8-K | $32.26 $32.37 | ▲ +0.34% | ▲ +0.40% | $32.71 (+1.39%) |
Oct 7, 2026 25d ago | SC 13G/A | $34.00 $32.26 | ▼ −5.12% | ▼ −5.72% | $32.71 (−3.79%) |
Aug 3, 2026 12w ago | 8-K | $40.77 $40.28 | ▼ −1.20% | ▼ −3.00% | $32.71 (−19.77%) |
May 4, 2026 25w ago | 8-K | $38.71 $38.38 | ▼ −0.86% | ▼ −1.66% | $32.71 (−15.51%) |
Mar 4, 2026 34w ago | 8-K | $38.08 $39.26 | ▲ +3.10% | ▲ +4.42% | $32.71 (−14.10%) |
US Market Status
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