Western Midstream Partners (NYSE:WES) Shares Gap Down Following Weak Earnings

Key Points

• Western Midstream's stock gapped down after Q4 results showed an EPS miss of $0.47 vs. $0.91 consensus and slightly light revenue ($1.03B vs. ~$1.06B), with the shares opening at $40.51 after a $43.90 close.
• The partnership pays a high quarterly dividend ($0.91, a 8.9% yield annualized), but a 107.7% payout ratio and roughly 2.08 debt/equity raise questions about dividend sustainability and capital allocation.
• Offsetting the EPS miss, management reported record adjusted EBITDA for Q4 and the full year and beat midpoint guidance for net income/EBITDA, while analyst coverage is mixed with an average "Hold" rating and a $41.33 price target.

Western Midstream Partners, LP (NYSE:WES - Get Free Report)'s stock price gapped down before the market opened on Thursday following a weaker than expected earnings announcement. The stock had previously closed at $43.90, but opened at $40.51. Western Midstream Partners shares last traded at $41.3090, with a volume of 1,195,836 shares.

The pipeline company reported $0.47 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.91 by ($0.44). Western Midstream Partners had a net margin of 35.18% and a return on equity of 39.37%. The business had revenue of $1.03 billion during the quarter, compared to analyst estimates of $1.06 billion. During the same period in the previous year, the business posted $0.85 EPS. The business's revenue for the quarter was up 11.1% compared to the same quarter last year.

Western Midstream Partners Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Friday, February 13th. Investors of record on Monday, February 2nd were issued a $0.91 dividend. This represents a $3.64 dividend on an annualized basis and a dividend yield of 8.9%. The ex-dividend date was Monday, February 2nd. Western Midstream Partners's dividend payout ratio is currently 107.69%.

Western Midstream Partners News Summary

Here are the key news stories impacting Western Midstream Partners this week:

• Positive Sentiment: Company reported record adjusted EBITDA for Q4 and full‑year 2025 (Q4 Adjusted EBITDA $635.6M; full‑year $2.481B), and net income and EBITDA exceeded the midpoint of its full‑year guidance — evidence of strong underlying cash generation and operating performance. Western Midstream Announces Record Fourth-Quarter and Full-Year 2025 Results
• Neutral Sentiment: Industry M&A/speculation: reports that Texas midstream players and Kinetik are exploring sale processes highlight rising interest in midstream assets as gas demand grows — could affect sector comps and long‑term strategic options, but impact to WES is indirect and uncertain. Texas pipeline operator prepares sale process as gas demand booms
• Neutral Sentiment: Additional coverage on potential Kinetik sale and broader sector dynamics — useful context for relative valuation and investor interest in midstream M&A. Kinetik Holdings: A Potential Sale in the Pipeline
• Negative Sentiment: Q4 EPS materially missed estimates — reported $0.47 vs. consensus $0.91 — and revenue came in slightly light ($1.03B vs. ~$1.06B), driving the immediate selloff; the EPS shortfall is the primary near‑term negative catalyst. Western Midstream misses Q4 earnings estimates, shares fall
• Negative Sentiment: Company disclosed $29.5M of unfavorable non‑cash revenue adjustments in Q4; while EBITDA remained strong, these adjustments and the EPS miss raise near‑term earnings quality questions for some investors. Western Midstream: Q4 Earnings Snapshot
• Negative Sentiment: Balance‑sheet/leverage considerations (reported debt/equity ~2.08) and the drop from expectations increase scrutiny on capital allocation and dividend sustainability if commodity or throughput trends deteriorate. Western Midstream Partners LP (WES) Q4 2025: Everything You Need To Know Ahead Of Earnings

Analyst Ratings Changes

WES has been the subject of a number of recent research reports. Royal Bank Of Canada boosted their price objective on Western Midstream Partners from $39.00 to $42.00 and gave the stock a "sector perform" rating in a report on Friday, November 28th. Wells Fargo & Company decreased their price target on Western Midstream Partners from $40.00 to $39.00 and set an "equal weight" rating for the company in a report on Thursday, January 22nd. Stifel Nicolaus set a $43.00 price objective on Western Midstream Partners in a research note on Thursday, November 6th. Finally, Wall Street Zen cut shares of Western Midstream Partners from a "buy" rating to a "hold" rating in a research report on Saturday, December 27th. One research analyst has rated the stock with a Buy rating, three have issued a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat, the company has an average rating of "Hold" and an average price target of $41.33.

Insider Activity

In other Western Midstream Partners news, SVP Christopher B. Dial sold 5,879 shares of the firm's stock in a transaction dated Thursday, February 12th. The stock was sold at an average price of $42.35, for a total value of $248,975.65. Following the completion of the transaction, the senior vice president owned 185,011 shares in the company, valued at $7,835,215.85. This trade represents a 3.08% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through this hyperlink. Insiders own 0.04% of the company's stock.

Institutional Investors Weigh In On Western Midstream Partners

Institutional investors and hedge funds have recently modified their holdings of the company. Alps Advisors Inc. increased its holdings in Western Midstream Partners by 0.9% during the 4th quarter. Alps Advisors Inc. now owns 35,074,357 shares of the pipeline company's stock worth $1,385,437,000 after acquiring an additional 299,631 shares during the period. Invesco Ltd. grew its position in shares of Western Midstream Partners by 0.3% during the 3rd quarter. Invesco Ltd. now owns 24,292,437 shares of the pipeline company's stock valued at $954,450,000 after purchasing an additional 81,183 shares in the last quarter. Goldman Sachs Group Inc. increased its holdings in shares of Western Midstream Partners by 10.9% in the fourth quarter. Goldman Sachs Group Inc. now owns 9,562,213 shares of the pipeline company's stock worth $377,707,000 after purchasing an additional 936,376 shares during the period. Tortoise Capital Advisors L.L.C. raised its position in shares of Western Midstream Partners by 15.8% in the fourth quarter. Tortoise Capital Advisors L.L.C. now owns 8,539,175 shares of the pipeline company's stock worth $337,297,000 after buying an additional 1,163,991 shares in the last quarter. Finally, MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. bought a new stake in Western Midstream Partners during the third quarter valued at $300,257,000. 84.82% of the stock is owned by hedge funds and other institutional investors.

Western Midstream Partners Stock Performance

The firm has a market capitalization of $16.68 billion, a PE ratio of 12.10 and a beta of 0.77. The company has a quick ratio of 1.43, a current ratio of 1.43 and a debt-to-equity ratio of 2.08. The company has a 50-day moving average of $40.72 and a 200 day moving average of $39.35.

Western Midstream Partners Company Profile

Western Midstream Partners, LP NYSE: WES is a midstream energy infrastructure company that owns, operates and develops an integrated network of crude oil, natural gas and produced water gathering, processing, transportation and storage assets in the United States. The partnership's primary offerings include pipeline transportation, fractionation services, natural gas liquids (NGL) logistics and produced water handling. Through its fee-based and commodity-based contracts, Western Midstream provides its customers with essential services that support efficient energy production and distribution.

The company's asset portfolio spans key onshore basins, including the Delaware Basin in West Texas and southeastern New Mexico, the San Juan Basin in New Mexico and Colorado, and the Denver-Julesburg Basin in Colorado.

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