Hess Midstream announces public offering of Class A shares

HOUSTON - Hess Midstream LP (NYSE: HESM), a midstream oil and gas company with a market capitalization of $8.2 billion, has begun a public offering of 15,022,517 Class A shares, represented by an affiliate of Global Infrastructure Partners, a segment of BlackRock. The transaction was announced today, with the company clarifying that it will not receive any proceeds from the share sale. According to InvestingPro data, HESM maintains a notable 7.4% dividend yield and has raised its dividend for eight consecutive years.

The shares are available through an underwritten public offering with J.P. Morgan and Citigroup serving as the joint bookrunning managers. Interested parties can access the preliminary prospectus supplement and accompanying base prospectus through the Securities and Exchange Commission’s (SEC) website or directly from the managing financial institutions.

The offering is conducted in accordance with an effective shelf registration statement previously filed with the SEC. The sale of these securities will comply with the Securities Act of 1933, as amended, ensuring that no sale occurs in jurisdictions where it would be unlawful without proper registration or qualification under the applicable securities laws.

Hess Midstream LP is a growth-oriented company that provides midstream services to Hess Corporation and other customers. Their assets, which include oil, gas, and produced water handling facilities, are primarily situated in the Bakken and Three Forks Shale plays in North Dakota. The company demonstrates strong financial performance with a "GOOD" overall health score on InvestingPro, generating $1.5 billion in revenue over the last twelve months with an impressive 77% gross profit margin.

This press release from Hess Midstream LP contains forward-looking statements, which are based on projections and expectations rather than historical data. The company has indicated that it does not intend to update these statements and advises caution when placing reliance on them. For deeper insights into HESM’s valuation and growth prospects, including 10+ additional ProTips and comprehensive financial analysis, check out the detailed Pro Research Report available on InvestingPro. The full details of the offering, including risk factors and other cautionary statements, are detailed in Hess Midstream’s filings with the SEC, which are publicly available.

The information for this article is based on a press release statement from Hess Midstream LP.

In other recent news, Hess Midstream LP reported its Q1 2025 earnings, showing a slight beat on earnings per share (EPS) but a miss on revenue expectations. The company achieved an EPS of $0.65, surpassing the forecast of $0.63, while revenue was $382 million, slightly below the expected $384.46 million. Despite the revenue shortfall, Hess Midstream maintained a strong gross adjusted EBITDA margin of 80%. Additionally, the company has initiated a $200 million share repurchase program, which includes the buyback of $190 million worth of Class B units from sponsors Hess Corporation and Global Infrastructure Partners, and a $10 million accelerated share repurchase of Class A shares from the public.

The repurchase transactions are expected to enhance distributable cash flow per Class A share, potentially allowing for distribution growth above the company’s annual target of at least 5% through 2027. The buybacks will be funded through borrowings under the company’s existing credit facility. Hess Midstream’s CFO, Jonathan Stein, emphasized the alignment of these transactions with the company’s financial strategy to deliver shareholder returns while maintaining balance sheet strength. The company also reaffirmed its guidance for Q2 2025, projecting net income between $170-180 million and adjusted EBITDA of $300-310 million.

For the full year 2025, Hess Midstream anticipates net income of $715-765 million and adjusted EBITDA of $1.235-1.285 billion, with capital expenditures around $300 million. The company expressed confidence in its growth strategy, highlighting its stable operational performance and plans for ongoing capital returns to shareholders. Hess Midstream also noted its financial flexibility, with over $1.25 billion available to support further repurchases through 2027.

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