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Hess Midstream LP price target raised to $44 from $41 at Citi

Hess Midstream LP price target raised to $44 from $41 at Citi

Citi analyst Spiro Dounis raised the firm’s price target on Hess Midstream LP (HESM) to $44 from $41 to reflect an improving free cash flow profile beyond 2027, while keeping a Buy rating on the shares. The firm notes 2025 capex guidance of $300M came in above its prior estimate, but says it now anticipates a meaningful step lower in capex once additional processing capacity enters service in 2027. Management pointed toward having line of sight to free cash flow growth through the end of the decade, which Citi expects to be driven by a combination of EBITDA growth and declining capex. Specifically, it sees capex trending toward $125M over time as Hess Midstream LP completes its existing project backlog. As a result, the firm expects free cash flow growth to outpace EBITDA growth over the medium-term, allowing for a continuation and possibly even an acceleration of the existing capital allocation program.

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