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Dt Midstream, Inc. (DTM)
:DTM
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DT Midstream
(NYSE:DTM)
74Outperform
Positive Factors
Growth Potential
The company has a backlog of $2.3 billion in potential capital projects, which should increase EBITDA to $1.5 billion by 2029, indicating strong future growth potential.
Market Position
DT Midstream is being upgraded to Buy from Hold due to an attractive opportunity presented by the recent stock pullback.
Strategic Expansion
DTM announced two new data center projects, indicating expansion and future revenue opportunities.
Negative Factors
Dividend Expectations
The dividend increase was below forecast, with a Q4 dividend declared at $0.82 per share compared to an expected $0.87.
Financial Performance
Q4 missed expectations with adjusted EBITDA of $235 million falling below the consensus of $248 million.
Valuation Concerns
Despite DTM's improved fundamental outlook, shares are considered fairly valued after strong year-over-year performance.
DT Midstream (DTM) vs. S&P 500 (SPY)
Market Cap
$9.45B
Dividend Yield3.41%
Average Volume (3M)1.56M
Price to Earnings (P/E)25.9
Beta (1Y)0.80
Revenue Growth6.40%
EPS Growth-8.42%
CountryUS
Employees556
SectorEnergy
Sector Strength52
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)3.60
Shares Outstanding101,590,680
10 Day Avg. Volume1,384,308
30 Day Avg. Volume1,557,108
Financial Highlights & Ratios
PEG Ratio1.56
Price to Book (P/B)N/A
Price to Sales (P/S)10.02
Price to Cash Flow (P/CF)16.20
P/FCF Ratio17.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$107.10Price Target Upside15.10% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
DT Midstream Business Overview & Revenue Model
Company DescriptionDT Midstream, Inc. provides integrated natural gas services in the United States. The company operates through two segments, Pipeline and Gathering. It develops, owns, and operates an integrated portfolio of interstate pipelines, intrastate pipelines, storage systems, lateral pipelines, gathering systems, related treatment plants, and compression and surface facilities. The company engages in the transportation and storage of natural gas for intermediate and end user customers; and collecting natural gas from points at or near customers' wells for delivery to plants for processing, to gathering pipelines for gathering, or to pipelines for transportation, as well as offers compression, dehydration, gas treatment, water impoundment, water storage, water transportation, and sand mining services. It serves natural gas producers, local distribution companies, electric power generators, industrials, and national marketers. The company was incorporated in 2021 and is headquartered in Detroit, Michigan.
How the Company Makes MoneyDT Midstream generates revenue through a combination of fee-based and volume-based contracts for its natural gas transportation and storage services. The company owns and operates an extensive network of pipelines and storage facilities across key natural gas producing regions in the United States. Revenue primarily comes from long-term contracts with fixed fees, providing stable and predictable cash flows. Additionally, DT Midstream may engage in strategic partnerships and joint ventures to expand its infrastructure capabilities. The company also leverages its expertise to optimize the utilization of its assets, ensuring high reliability and efficiency in its operations, which further contributes to its earnings.
DT Midstream Financial Statement Overview
Summary
DT Midstream presents a strong financial profile with consistent revenue growth and profitability. Income statement shows robust profitability, balance sheet reflects moderate stability with manageable leverage, and cash flow indicates efficient cash generation. However, further reduction of leverage could enhance financial stability.Income Statement
DT Midstream demonstrates strong profitability with a consistent increase in gross and net profit margins over the years. The gross profit margin in the latest annual report is 75.13%, and the net profit margin is 37.39%. Revenue has grown steadily, with a 6.4% increase from the previous year, indicating solid top-line growth.85
Very Positive
Balance Sheet
The balance sheet shows a relatively stable position with a debt-to-equity ratio of 0.44, highlighting manageable leverage. However, the equity ratio stands at 52.67%, indicating moderate financial stability. Return on equity is at 7.93%, suggesting decent profitability for shareholders.70
Positive
Cash Flow
DT Midstream's cash flow is robust, with a significant increase in free cash flow, which grew by 2826.92% in the last year. The operating cash flow to net income ratio is healthy at 2.08, highlighting efficient cash generation relative to earnings. However, reliance on operating cash flow is crucial as the company had significant capital expenditures in prior years.78
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 981.00M | 922.00M | 920.00M | 840.00M | 754.00M | Gross Profit |
| 737.00M | 495.00M | 653.00M | 609.00M | 427.00M | EBIT |
| 489.00M | 467.00M | 478.00M | 551.00M | 414.00M | EBITDA |
| 866.00M | 850.00M | 808.00M | 718.00M | 722.00M | Net Income Common Stockholders |
| 354.00M | 384.00M | 370.00M | 307.00M | 312.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 68.00M | 56.00M | 61.00M | 132.00M | 42.00M | Total Assets |
| 9.94B | 8.98B | 8.83B | 8.17B | 8.34B | Total Debt |
| 202.00M | 3.27B | 3.42B | 3.08B | 3.22B | Net Debt |
| 202.00M | 3.21B | 3.36B | 2.95B | 3.18B | Total Liabilities |
| 5.17B | 4.70B | 4.68B | 4.14B | 4.11B | Stockholders Equity |
| 4.63B | 4.14B | 4.01B | 3.87B | 4.07B |
| Cash Flow | Free Cash Flow | |||
| 763.00M | 26.00M | 387.00M | 432.00M | 79.00M | Operating Cash Flow |
| 763.00M | 798.00M | 725.00M | 572.00M | 597.00M | Investing Cash Flow |
| -1.08B | -351.00M | -854.00M | 123.00M | -714.00M | Financing Cash Flow |
| 330.00M | -452.00M | 58.00M | -605.00M | 113.00M |
DT Midstream Technical Analysis
Negative
93.05
Price Trends
96.27
Negative
99.24
Negative
88.12
Positive
Market Momentum
0.44
Negative
53.35
Neutral
27.92
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DTM, the sentiment is Negative. The current price of 93.05 is below the 20-day moving average (MA) of 95.76, below the 50-day MA of 96.27, and above the 200-day MA of 88.12, indicating a neutral trend. The MACD of 0.44 indicates Negative momentum. The RSI at 53.35 is Neutral, neither overbought nor oversold. The STOCH value of 27.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DTM.
DT Midstream Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $8.24B | 14.41 | 51.23% | 7.68% | 10.89% | 19.50% | |
80 Outperform | $13.92B | 9.09 | 50.12% | 10.00% | 16.06% | 54.94% | |
80 Outperform | $7.81B | 19.77 | 18.79% | 5.64% | 5.79% | 7.52% | |
78 Outperform | $12.08B | 23.44 | 7.56% | 8.31% | 3.28% | -47.59% | |
74 Outperform | $9.45B | 25.86 | 8.08% | 3.41% | 6.40% | -8.42% | |
57 Neutral | $6.92B | 42.84 | -8.21% | 7.28% | 21.85% | -54.68% | |
57 Neutral | $7.68B | 4.29 | -3.52% | 6.80% | -0.14% | -64.60% |
* Energy Sector Average
Performance Comparison
DTM
DT Midstream
93.05
32.07
52.59%
PAA
Plains All American
17.16
0.44
2.63%
WES
Western Midstream Partners
36.51
4.22
13.07%
AM
Antero Midstream
16.31
3.11
23.56%
HESM
Hess Midstream Partners
36.85
3.64
10.96%
KNTK
Kinetik
45.24
8.41
22.83%
DT Midstream Earnings Call Summary
Earnings Call Date: Feb 26, 2025 | % Change Since: -2.03% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with strong financial performance, strategic acquisitions, and positive market positioning being weighed against challenges such as depressed natural gas prices and regulatory delays in specific projects. The sentiment in the call reflects confidence in future growth and successful integration of acquisitions, but with cautious optimism due to ongoing market and regulatory challenges.Highlights
Record Safety Performance
DT Midstream, Inc. finished the year with zero OSHA recordable safety incidences, showcasing an exceptional commitment to safety.
Adjusted EBITDA Achievement
The company delivered an adjusted EBITDA of $969 million, exceeding the increased guidance midpoint and marking a record high year with a 10% compounded annual growth since 2021.
Successful Midwest Pipeline Acquisition
The acquisition of the Midwest pipeline from One Oak expanded DT Midstream's FERC interstate natural gas pipeline network, with successful integration underway.
Strong Pipeline Segment Growth
The pipeline segment grew by 7% year over year, driven by new LEAP expansions and higher storage revenue.
Investment Grade Upgrade
DT Midstream was upgraded to investment grade by Fitch and expects further upgrades in 2025 by S&P and Moody's.
Positive Market Sentiment and Outlook
The company is well-positioned to capitalize on a more constructive pricing environment and increased natural gas market demand in 2025.
Dividend Increase
The board declared a quarterly dividend increase to $0.82 per share, representing a 12% increase.
Lowlights
Depressed Natural Gas Prices
The company faced macro sector headwinds, including depressed natural gas prices, causing producer slowdowns and a pause in LNG export permits.
Production Deferrals and Outages
The Gathering segment results were impacted by $6 million lower than the prior quarter due to producer deferrals and a key customer outage in Haynesville.
Regulatory Delays in CCS Project
The CCS project in Louisiana is experiencing delays due to a lengthy state permitting process, with no definitive timeline for resolution.
Company Guidance
During the DT Midstream, Inc. fourth quarter and year-end 2024 earnings call, the company provided extensive guidance for 2025 and beyond. DT Midstream achieved a record-high adjusted EBITDA of $969 million in 2024, representing a 5% increase from the prior year and a 10% compounded annual growth since 2021. The 2025 adjusted EBITDA guidance is set between $1.95 billion and $2.155 billion, reflecting an 18% growth from the 2024 original guidance, with a 2026 outlook of $2.155 billion to $2.225 billion. The company anticipates maintaining a 5% to 7% long-term organic growth rate, supported by a $2.3 billion project backlog primarily in pipeline projects, with 70% comprising pipeline opportunities. The 2025 growth capital guidance is between $400 million and $460 million. The call also highlighted new projects, including a 300 million cubic feet per day lateral to AES Indiana's Petersburg power plant, expected to be in service by Q1 2026, and a 20-year contract for a West Virginia power plant, pending FID in 2026. DT Midstream, Inc. emphasized its focus on disciplined financial management, aiming for an investment-grade rating, and announced a 12% increase in its quarterly dividend to $0.82 per share. The company projects a positive environment for natural gas infrastructure investment, foreseeing significant demand growth across its Haynesville system and other assets.DT Midstream Corporate Events
DividendsBusiness Operations and StrategyFinancial Disclosures
DT Midstream Reports Record 2024 Financial Results
Positive
Feb 26, 2025
On February 26, 2025, DT Midstream reported record financial results for 2024, with a full-year adjusted EBITDA of $969 million and net income of $354 million. The company announced a 12% increase in its quarterly dividend to $0.82 per share, payable on April 15, 2025, and raised its 2025 adjusted EBITDA guidance to a range of $1.095 to $1.155 billion. Additionally, DT Midstream executed agreements for new projects to serve utility-scale power generation, reflecting its strong market positioning and commitment to growth.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.