Hess Midstream Partners (NYSE:HESM) Stock Sees Heavy Put Option Buying

Key Points

• Put option activity surged: Investors purchased 22,237 HESM put options, roughly 2,639% above the typical volume of 812 contracts.
• Shares fell 15% to $32.90 on unusually heavy trading volume, while analysts’ consensus rating remained “Reduce” with an average price target of $37.00.
• Hess Midstream increased its quarterly dividend to $0.7888 per share, equivalent to an annualized $3.16 payout and a 9.6% yield, despite a payout ratio above 100%.

Hess Midstream Partners LP (NYSE:HESM - Get Free Report) was the target of unusually large options trading activity on Wednesday. Investors purchased 22,237 put options on the company. This represents an increase of approximately 2,639% compared to the typical volume of 812 put options.

Institutional Investors Weigh In On Hess Midstream Partners

A number of institutional investors have recently modified their holdings of the company. Palo Duro Investment Partners LP boosted its stake in shares of Hess Midstream Partners by 3.6% in the second quarter. Palo Duro Investment Partners LP now owns 10,309 shares of the company's stock valued at $388,000 after buying an additional 363 shares in the last quarter. Sanctuary Advisors LLC raised its position in Hess Midstream Partners by 0.5% in the second quarter. Sanctuary Advisors LLC now owns 82,818 shares of the company's stock worth $3,114,000 after acquiring an additional 408 shares in the last quarter. Westover Capital Advisors LLC raised its position in Hess Midstream Partners by 0.7% in the first quarter. Westover Capital Advisors LLC now owns 95,993 shares of the company's stock worth $3,731,000 after acquiring an additional 638 shares in the last quarter. Sequoia Financial Advisors LLC lifted its holdings in Hess Midstream Partners by 8.7% in the first quarter. Sequoia Financial Advisors LLC now owns 8,700 shares of the company's stock valued at $338,000 after acquiring an additional 699 shares during the period. Finally, Legal & General Group Plc lifted its holdings in Hess Midstream Partners by 0.7% in the second quarter. Legal & General Group Plc now owns 108,105 shares of the company's stock valued at $4,065,000 after acquiring an additional 744 shares during the period. 98.97% of the stock is owned by institutional investors and hedge funds.

Analyst Ratings Changes

Several analysts have recently commented on HESM shares. Morgan Stanley reaffirmed an "underweight" rating and set a $39.00 price target on shares of Hess Midstream Partners in a research report on Tuesday, July 21st. Weiss Ratings reissued a "buy (b)" rating on shares of Hess Midstream Partners in a research note on Monday, September 21st. Finally, JPMorgan Chase & Co. downgraded Hess Midstream Partners from a "neutral" rating to an "underweight" rating and set a $39.00 target price on the stock. in a research report on Friday, October 2nd. One research analyst has rated the stock with a Buy rating, three have assigned a Hold rating and three have assigned a Sell rating to the company. According to MarketBeat.com, the stock currently has a consensus rating of "Reduce" and an average target price of $37.00.

Hess Midstream Partners Trading Down 15.0%

Shares of HESM traded down $5.79 during trading on Wednesday, reaching $32.90. 7,463,511 shares of the company traded hands, compared to its average volume of 1,570,091. The stock has a 50-day simple moving average of $39.64 and a 200-day simple moving average of $39.08. The stock has a market cap of $6.78 billion, a PE ratio of 11.37 and a beta of 0.58. Hess Midstream Partners has a twelve month low of $31.63 and a twelve month high of $41.44. The company has a quick ratio of 0.77, a current ratio of 0.77 and a debt-to-equity ratio of 9.39.

Hess Midstream Partners (NYSE:HESM - Get Free Report) last issued its quarterly earnings data on Monday, August 3rd. The company reported $0.75 EPS for the quarter, topping the consensus estimate of $0.67 by $0.08. Hess Midstream Partners had a net margin of 23.23% and a return on equity of 92.18%. The firm had revenue of $399.00 million for the quarter, compared to analyst estimates of $395.96 million. During the same period in the prior year, the business posted $0.74 EPS. The business's revenue for the quarter was down 3.7% compared to the same quarter last year. On average, analysts anticipate that Hess Midstream Partners will post 2.94 earnings per share for the current year.

Hess Midstream Partners Increases Dividend

The company also recently declared a quarterly dividend, which was paid on Friday, August 14th. Shareholders of record on Thursday, August 6th were paid a dividend of $0.7888 per share. This represents a $3.16 dividend on an annualized basis and a yield of 9.6%. This is a positive change from Hess Midstream Partners's previous quarterly dividend of $0.7792. The ex-dividend date was Thursday, August 6th. Hess Midstream Partners's payout ratio is currently 108.97%.

Hess Midstream Partners Company Profile

Hess Midstream Partners LP NYSE: HESM is a fee-based midstream energy company that owns and operates infrastructure supporting crude oil, natural gas and produced-water production in the Bakken Shale of North Dakota. The partnership primarily serves Hess Corp. and other producers operating in the region.

Its assets include systems for gathering and processing natural gas, gathering and transporting crude oil, and handling and disposing of produced water. Hess Midstream also provides storage, terminal and transportation services, helping connect production sites with downstream pipelines, rail facilities and other market outlets.

The company was formed to own midstream assets previously developed or operated by Hess and began trading publicly in 2017.

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