Analyst Ned Baramov of Wells Fargo maintained a Hold rating on Western Midstream Partners (WES – Research Report), with a price target of $39.00.
Ned Baramov has given his Hold rating due to a combination of factors impacting Western Midstream Partners. The company’s Q4 adjusted results came in slightly below consensus expectations, which contributed to a cautious outlook. Although the 2025 EBITDA guidance aligns with market expectations, the capital expenditure forecast is notably higher due to new water projects, leading to lower free cash flow projections.
Additionally, while Western Midstream Partners plans to increase distributions by 4% in 2025, exceeding consensus estimates, the overall free cash flow after distributions is expected to be neutral to slightly negative. Despite these challenges, the partnership maintains a strong balance sheet with a leverage ratio in line with industry peers, which supports the Hold rating. The focus on expanding the water business and the new buyback authorization also play a role in the current assessment.
In another report released yesterday, Stifel Nicolaus also maintained a Hold rating on the stock with a $40.00 price target.
WES’s price has also changed slightly for the past six months – from $37.970 to $39.950, which is a 5.21% increase.