Hess Midstream (NYSE:HESM) Stock, Quote.Headers.trade-ideas

Hess Midstream

Hess Midstream LP owns, operates, develops, and acquires a diverse set of midstream assets and provides fee-based services to Hess and third-party customers. It conducts its business through three operating segments: gathering, processing and storage, and terminaling and exporting. The company derives the maximum revenue from the gathering segment. Its gathering segment consists of the following assets namely Natural Gas Gathering and Compression; Crude Oil Gathering and Produced Water Gathering and Disposal.

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HESM

Halliburton Company (NYSE: HAL) has announced a collaboration with Abu Dhabi-based artificial intelligence firm AIQ, to combine the RoboWell autonomous well control solution with Halliburton Landmark&#39;s iEnergy hybrid cloud.

Halliburton and AIQ Join Forces to Boost Well Efficiency

SHEL

California Resources Corporation (NYSE: CRC) has concluded its $1.13 billion all-stock merger, announced in February 2024, with Aera Energy, LLC.

California Resources Concludes Merger With Aera Energy

Small Cap

AROC

Diversified Energy Company plc (NYSE: DEC) has completed the acquisition of a proportionate working interest in certain assets from Oaktree Capital Management. The assets are located within the company&#39;s Central Region, in Oklahoma, East Texas and Louisiana.

Diversified Energy Acquires Accretive Assets Worth $377M

Hess Midstream LP

JP Morgan analyst Jeremy Tonet maintains Hess Midstream (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HESM#NYSE">HESM</a>) with a Neutral and raises the price target from $38 to $39.

Price Target

JP Morgan Maintains Neutral on Hess Midstream, Raises Price Target to $39

Hess Midstream (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HESM#NYSE">HESM</a>) reported quarterly earnings of $0.59 per share which missed the analyst consensus estimate of $0.62 by 4.84 percent. This is a 18 percent increase over earnings of $0.50 per share from the same period last year. The company reported quarterly sales of $365.500 million which beat the analyst consensus estimate of $365.163 million by 0.09 percent. This is a 12.81 percent increase over sales of $324.000 million the same period last year.

Earnings

Earnings Beats

Earnings Misses

Hess Midstream Q2 2024 GAAP EPS $0.59 Misses $0.62 Estimate, Sales $365.500M Beat $365.163M Estimate

Halliburton Company&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/hal#NYSE">HAL</a>) has announced a collaboration with Abu Dhabi-based artificial intelligence firm AIQ, to combine the RoboWell autonomous well control&nbsp;solution with Halliburton Landmark&#39;s iEnergy hybrid cloud. RoboWell, developed by AIQ, is the first advanced process control solution designed for gas-lifted wells supported by AI.
AIQ believes that the agreement with Halliburton&#39;s Landmark is a pivotal step toward expanding the use of AI-enabled AWC tools across the upstream sector globally. An increase in the use of AI-enabled solutions should help optimize operations and increase production across the entire oil and gas industry. Landmark&#39;s iEnergy cloud platform has been developed for the deployment, integration and management of advanced exploration and production applications. Further, the platform can also connect assets in public or private cloud environments.
Owing to the collaboration, AIQ&#39;s RoboWell autonomous well control will be integrated into the iEnergy cloud platform, making it accessible to Halliburton&#39;s customers worldwide. RoboWell enables autonomous well operations and is engineered to maximize production under specified conditions. It also supports environmental sustainability by reducing carbon dioxide emissions and upholding health, safety and environmental standards. AIQ&#39;s AI-enabled technology has achieved a 30% optimization in gas lift consumption, thereby raising the production from existing wells by up to 5%.
AIQ&#39;s management has stated that the partnership with Halliburton aligns with its wider strategy of expanding the availability of its AI-powered technologies to support the oil and gas industry worldwide. Halliburton also remarked that combining its expertise in the industry with AIQ&#39;s AI-based solutions will help provide greater efficiency and asset value for its customers.
<h3>Zacks Rank and Key Picks</h3>
Currently, HAL carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the energy&nbsp;sector are&nbsp;SM Energy (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/sm#NYSE">SM</a>), Hess Midstream Partners LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/hesm#NYSE">HESM</a>) and Chevron Corporation (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/cvx#NYSE">CVX</a>). SM Energy and Hess Midstream presently sport a Zacks Rank #1 (Strong Buy) each, while CVX carries a Zacks Rank #2 (Buy).
SM Energy is an upstream energy firm operating in the prolific Midland Basin and the South Texas regions. For 2024, the company expects its production to increase from the prior-year reported figure, signaling a bright production outlook.
Hess Midstream owns, operates, develops, and acquires a wide range of midstream assets, providing services to Hess Corporation and other third-party customers. The partnership has a stable fee-based revenue model secured via long-term commercial contracts. Since Hess Midstream operates through 100% fee-based contracts, it is exposed to minimal commodity price risks.
Chevron is one of the largest publicly traded oil and gas companies in the world, with its operations spread around the globe. It is currently in the process of acquiring Hess Corporation. The acquisition is seen as a major win for Chevron, as it will give the company access to Hess&#39; high-quality assets in Guyana and the Bakken Formation.
<a href="https://www.zacks.com/stock/news/2298583/halliburton-hal-and-aiq-join-forces-to-boost-well-efficiency?cid=CS-BENZ-FT-analyst_blog|company_news_energy_sector-2298583">To read this article on Zacks.com click here.</a>

UBS analyst Brian Reynolds maintains Hess Midstream (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HESM#NYSE">HESM</a>) with a Buy and raises the price target from $38 to $40.

UBS Maintains Buy on Hess Midstream, Raises Price Target to $40

California Resources Corporation&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/crc#NYSE">CRC</a>) has concluded its $1.13 billion all-stock merger, announced in February 2024, with Aera Energy, LLC. The total valuation of the deal is $2.1 billion, including debt.In a special meeting held on Jun 26, 2024, CRC shareholders authorized the issuance of stocks needed to close the merger deal. As part of the agreement, the entities owning Aera Energy have received 21.3 million shares of common stock of CRC. The total value of $1.13 billion was based on the closing price of the CRC stock on Jun 28.
Aera Energy is a joint venture (JV) between Shell (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/shel#NYSE">SHEL</a>) and ExxonMobil&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xom#NYSE">XOM</a>) that was later sold to IKAV, a German asset manager in February 2023 for $4 billion. Following this acquisition, the Canada Pension Plan Investment Board (&quot;CPP&quot;) purchased a 49% stake in the JV. Additionally, Oaktree Capital Management, LP holds equity in Aera Energy.
During April and May 2024, the pro forma net daily production of CRC and Aera averaged 146 thousand barrels of oil equivalent per day (Mboe/d), with 79% of this production being oil. For the second half of the year, the combined company projects capital expenditure between $170 million and $210 million, and net daily production in the range of 140-146 Mboe/d.
CRC&#39;s management is confident in the combined company&#39;s ability to achieve $150 million in annual synergies within 15 months of the deal&#39;s closure. The deal is also expected to boost free cash flows and create long-term value for the shareholders. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Along with the closure of the transaction, CRC has increased its borrowing base from $1.2 to $1.5 billion. The company has also increased the aggregate commitment amount under its Revolving Credit Facility from $630 million to $1.1 billion.
The combined company will be run by the current executive board of California Resources, with Bobby Saadati, CEO of IKAV Energy Inc., and James Jackson, managing director, Sustainable Energies at Canada Pension Plan Investment Board, as part of the board of directors.
<h3>Zacks Rank and Key Picks</h3>
Currently, CRC carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the energy&nbsp;sector are&nbsp;Sunoco LP, SM Energy&nbsp;and Hess Midstream Partners LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/hesm#NYSE">HESM</a>). Sunoco presently sports a Zacks Rank #1 (Strong Buy), while SM Energy and Hess Midstream carry a Zacks Rank #2 (Buy) each.
Sunoco LP is one of the largest distributors of motor fuel in the United States. The partnership distributes fuel to independent dealers, commercial customers, convenience stores as well as distributors. Its current distribution yield is greater than the composite stocks in the industry, providing unitholders with consistent returns.
SM Energy is an upstream energy firm operating in the prolific Midland Basin and the South Texas regions. For 2024, the company expects its production to increase from the prior-year reported figure, signaling a bright production outlook.
Hess Midstream owns, operates, develops and acquires a wide range of midstream assets, providing services to Hess Corporation and other third-party customers. The partnership has a stable fee-based revenue model secured via long-term commercial contracts. Since Hess Midstream operates through 100% fee-based contracts, it is exposed to minimal commodity price risks.
<a href="https://www.zacks.com/stock/news/2296136/california-resources-crc-concludes-merger-with-aera-energy?cid=CS-BENZ-FT-analyst_blog|company_news_energy_sector-2296136">To read this article on Zacks.com click here.</a>

Buybacks

Hess Midstream Announces Definitive Agreement Providing For The Repurchase Of ~$100M Of Class B Units by Subsidiary Hess Midstream Operations LP

Hess Midstream LP (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HESM#NYSE">HESM</a>) ("Hess Midstream") today announced the execution of a definitive agreement providing for the repurchase of approximately $100 million of Class B units by its subsidiary, Hess Midstream Operations LP, from affiliates of Hess Corporation and Global Infrastructure Partners, Hess Midstream's sponsors (the "Sponsors"). The terms of the proposed unit repurchase transaction were unanimously approved by the Board of Directors of Hess Midstream's general partner, based on the unanimous approval and recommendation of its conflicts committee composed solely of independent directors.

Hess Midstream LP Announces Execution Of A Definitive Agreement Providing For The Repurchase Of ~$100M Of Class B Units By Its Subsidiary, Hess Midstream Operations LP, From Affiliates Of Hess Corporation And Global Infrastructure Partners

Diversified Energy Company plc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/dec#NYSE">DEC</a>) has completed the acquisition of a proportionate working interest in certain assets from Oaktree Capital Management. The assets are located within the company&#39;s Central Region, in Oklahoma, East Texas and Louisiana. Diversified Energy announced the acquisition in March 2024, valued at $410 million before customary price adjustments.
The acquisition was completed at a net purchase price of $377 million, after applying customary price adjustments. The company will pay $83 million of the total consideration in deferred cash payments to Oaktree.&nbsp; DEC also assumes Oaktree&#39;s proportionate debt to be approximately $120 million.
The acquired assets currently produce approximately 122 million cubic feet equivalent per day (MMcfe/d). These include Proved Developed Producing&nbsp;reserves of 510 billion cubic feet equivalent (Bcfe). The value of the PDP reserves at PV10 is estimated to be $462 million. DEC expects Adjusted EBITDA for these assets in 2024 to be approximately $126 million.
In addition, the company has also concluded an acquisition-related review of its revolving credit facility. The borrowing base of the revolving credit facility has been redetermined and increased to $385 million by 26%. Following the increase in its revolving credit facility, DEC estimates that it will have an available liquidity of $130 million after accounting for the acquisition.
Diversified Energy has highlighted that the deal with Oaktree was a unique opportunity for the company to consolidate its assets. Management has also mentioned that the company will keep a disciplined approach and continue focusing on accretive acquisitions that will enhance scale and boost free cash flows for the company.
<h3>Zacks Rank and Other Key Picks</h3>
Currently, DEC carries a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks in the energy&nbsp;sector are Archrock Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/aroc#NYSE">AROC</a>), SM Energy (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/sm#NYSE">SM</a>) and Hess Midstream Partners LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/hesm#NYSE">HESM</a>). Archrock presently sports a Zacks Rank #1, while SM Energy and Hess Midstream carry a Zacks Rank #2 (Buy) each.
Archrock is an energy infrastructure company based in the United States, with a focus on midstream natural gas compression. It provides natural gas contract compression services and generates stable fee-based revenues.
SM Energy is an upstream energy firm operating in the prolific Midland Basin region and the South Texas region. For 2024, the company expects its production to increase from the prior-year reported figure, signaling a bright production outlook.
Hess Midstream owns, operates, develops and acquires a wide range of midstream assets, providing services to Hess Corporation and other third-party customers. The partnership has a stable fee-based revenue model secured via long-term commercial contracts. Since Hess Midstream operates through 100% fee-based contracts, it is exposed to minimal commodity price risks.
<a href="https://www.zacks.com/stock/news/2285882/diversified-energy-dec-acquires-accretive-assets-worth-377m?cid=CS-BENZ-FT-analyst_blog|company_news_energy_sector-2285882">To read this article on Zacks.com click here.</a>

Hess Midstream LP (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HESM#NYSE">HESM</a>) shares are trading lower by 3.83% to $34.44 during Thursday&#8217;s session after the company announced a 10 million share offering by a <a href="https://www.benzinga.com/pressreleases/24/05/b39077135/hess-midstream-lp-announces-pricing-of-secondary-public-offering-of-class-a-shares">selling shareholder</a>.
The public offering aims to generate $343 million in gross proceeds. The underwriter, J.P. Morgan, has a 30-day option to buy up to 1.5 million additional shares. Hess Midstream will not receive any proceeds from this sale. 
The offering is set to close on May 31, pending customary conditions. The shares will be sold on the NYSE, over-the-counter, or through negotiated transactions at market or negotiated prices.
See Also: <a href="https://www.benzinga.com/news/earnings/24/05/39084889/kohls-q1-earnings-revenue-and-profit-miss-outlook-cut-stock-tumbles">Kohl&#8217;s Q1 Earnings: Revenue And Profit Miss, Outlook Cut, Stock Tumbles</a>
<h2 class="wp-block-heading">How To Buy HESM Stock</h2>
Besides going to a brokerage platform to purchase a share &#8211; or fractional share &#8211; of stock, you can also gain access to shares either by buying an exchange traded fund (ETF) that holds the stock itself, or by allocating yourself to a strategy in your 401(k) that would seek to acquire shares in a mutual fund or other instrument. 
For example, in Hess Midstream&#8217;s case, it is in the Energy sector. An ETF will likely hold shares in many liquid and large companies that help track that sector, allowing an investor to gain exposure to the trends within that segment.
According to data from&nbsp;<a href="https://benzinga.grsm.io/register174">Benzinga Pro</a>, HESM has a 52-week high of $36.84 and a 52-week low of $27.11.

Why Hess Midstream Stock Is Trading Lower

WIIM

Hess Midstream shares are trading lower after the company announced a 10 million share offering by a selling shareholder.

HESM will not receive any proceeds from the sale of Class A shares in the offering. The offering is expected to close on May 31, 2024, subject to customary closing conditions.

Reported Earlier, Hess Midstream Prices Secondary Public Offering Of 10M Class A Shares

Offerings

Hess Midstream LP Announces Secondary Public Offering Of 10M Class A Shares

Hess Midstream Operations, A Consolidated Subsidiary Of Hess Midstream,  Announced That It Intends To Offer $500M Aggregate Principal Amount Of Senior Unsecured Notes Due 2029 In A Private Offering

Wells Fargo analyst Praneeth Satish maintains Hess Midstream (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HESM#NYSE">HESM</a>) with a Equal-Weight and raises the price target from $36 to $37.

Wells Fargo Maintains Equal-Weight on Hess Midstream, Raises Price Target to $37

Guidance
Hess Midstream continues to target at least&nbsp;5%&nbsp;annual distribution growth per Class A share through 2026 from this new higher level and continues to prioritize financial strength with a long-term leverage target of 3x Adjusted EBITDA. For 2025 and 2026, Hess Midstream continues to expect organic throughput volume growth across all systems relative to 2024 volume&nbsp;guidance.
Hess Midstream is reaffirming its full year 2024&nbsp;guidance&nbsp;as follows:
<table cellspacing="0">
<tbody>
<tr>
<td colspan="1" rowspan="1">
&nbsp;
</td>
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Year Ending
</td>
</tr>
<tr>
<td colspan="1" rowspan="1">
&nbsp;
</td>
<td colspan="2" rowspan="1">
December 31, 2024
</td>
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<td colspan="1" rowspan="1">
&nbsp;
</td>
<td colspan="2" rowspan="1">
(Unaudited)
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<td colspan="1" rowspan="1">
Financials (in millions)
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<td colspan="1" rowspan="1">
&nbsp;
</td>
<td colspan="1" rowspan="1">
&nbsp;
</td>
</tr>
<tr>
<td colspan="1" rowspan="1">
Net income
</td>
<td colspan="1" rowspan="1">
$
</td>
<td colspan="1" rowspan="1">
670 - 720
</td>
</tr>
<tr>
<td colspan="1" rowspan="1">
Adjusted EBITDA
</td>
<td colspan="1" rowspan="1">
$
</td>
<td colspan="1" rowspan="1">
1,125 - 1,175
</td>
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<tr>
<td colspan="1" rowspan="1">
Capital expenditures
</td>
<td colspan="1" rowspan="1">
$
</td>
<td colspan="1" rowspan="1">
250 - 275
</td>
</tr>
<tr>
<td colspan="1" rowspan="1">
Adjusted free cash flow
</td>
<td colspan="1" rowspan="1">
$
</td>
<td colspan="1" rowspan="1">
685 - 735
</td>
</tr>
</tbody>
</table>

Guidance

Hess Midstream Reaffirms 2024 Guidance For Net Income Of $670M - $720M, Adjusted EBITDA Of $1.125B – $1.175B And Adjusted Free Cash Flow Of $685M - $735M; Continues To Target At Least 5% Annual Distribution Growth Per Class A Share Through 2026

Hess Midstream (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HESM#NYSE">HESM</a>) reported quarterly earnings of $0.59 per share which missed the analyst consensus estimate of $0.62 by 4.84 percent. This is a 25.53 percent increase over earnings of $0.47 per share from the same period last year. The company reported quarterly sales of $355.600 million which beat the analyst consensus estimate of $351.862 million by 1.06 percent. This is a 16.59 percent increase over sales of $305.000 million the same period last year.

Hess Midstream Q1 2024 GAAP EPS $0.59 Misses $0.62 Estimate, Sales $355.600M Beat $351.862M Estimate

JP Morgan analyst Jeremy Tonet maintains Hess Midstream (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HESM#NYSE">HESM</a>) with a Neutral and raises the price target from $37 to $38.

JP Morgan Maintains Neutral on Hess Midstream, Raises Price Target to $38

Hess Midstream LP (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HESM#NYSE">HESM</a>) (&quot;Hess Midstream&quot;), today announced the execution of a definitive agreement providing for the repurchase of approximately&nbsp;$100 million&nbsp;of Class B units by its subsidiary, Hess Midstream Operations LP, from affiliates of Hess Corporation and Global Infrastructure Partners, Hess Midstream&#39;s sponsors (the &quot;Sponsors&quot;). The terms of the proposed unit repurchase transaction were unanimously approved by the Board of Directors of Hess Midstream&#39;s general partner, based on the unanimous approval and recommendation of its conflicts committee composed solely of independent directors.
&quot;We continue to execute unit repurchase transactions as part of our unique and differentiated financial strategy, which prioritizes shareholder returns and a strong balance sheet,&quot; said Jonathan Stein, Chief Financial Officer of Hess Midstream. &quot;Since the beginning of 2021 through this current transaction, we will have returned&nbsp;$1.65 billion&nbsp;to shareholders through ongoing unit repurchases from our Sponsors that have reduced the total unit count by over&nbsp;20%. Following this unit repurchase, which is expected to provide immediate accretion to our shareholders, we expect to continue to have more than&nbsp;$1.25 billion&nbsp;of financial flexibility through 2026 that can be used to support potential incremental unit repurchases.&quot;
Pursuant to the terms of the repurchase agreement, the repurchased units will be cancelled upon the closing of the unit repurchase transaction, which is expected to result in increased distributable cash flow per Class A share providing capacity for incremental distribution growth above Hess Midstream&#39;s annual distribution target of at least&nbsp;5%&nbsp;through 2026, consistent with Hess Midstream&#39;s return of capital framework.
Unit Repurchase Summary
Hess Midstream Operations LP, Hess Midstream&#39;s consolidated subsidiary, agreed to repurchase 2,816,901 Class B units of Hess Midstream Operations LP, equal to approximately&nbsp;1.2%&nbsp;of the consolidated company, held by the Sponsors for an aggregate purchase price of approximately&nbsp;$100 million. The purchase price per Class B unit is&nbsp;$35.50, the closing price of the Class A shares on March 11, 2024. After completing the unit repurchase transaction, ownership of Hess Midstream on a consolidated basis will be approximately&nbsp;35.4%&nbsp;for the public,&nbsp;26.8%&nbsp;for Global Infrastructure Partners and&nbsp;37.8%&nbsp;for Hess Corporation. The unit repurchase is anticipated to close on March 14, 2024. Hess Midstream expects to fund the unit repurchase through borrowings under its existing revolving credit facility.

Hess Midstream LP Announces Signing Of Accretive $100M Sponsor Unit Repurchase

JP Morgan analyst Jeremy Tonet downgrades Hess Midstream (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HESM#NYSE">HESM</a>) from Overweight to Neutral.

Downgrades

JP Morgan Downgrades Hess Midstream to Neutral

Hess Midstream Partners GAAP EPS of $0.59 beats by $0.03, revenue of $365.5M in-line

Hess Midstream Partners provides Q2 results, updates guidance

<a href="https://investorplace.com">InvestorPlace - Stock Market News, Stock Advice &amp; Trading Tips</a>
Hess Midstream (NYSE:<a href="https://investorplace.com/stock-quotes/hesm-stock-quote/">HESM</a>) just reported results for the second quarter of 2024.<ul><li>Hess Midstream reported earnings per share of 59 cents. This was below the analyst estimate for EPS of 63 cents.</li><li>The company reported revenue of $365.50 million.</li><li>This was 0.09% better than the analyst estimate for revenue of $365.16 million.</li></ul><div>InvestorPlace Earnings is a project that leverages data from <a href="https://www.tradesmith.com">TradeSmith</a> to automate coverage of quarterly earnings reports. InvestorPlace Earnings distills key takeaways including earnings per share and revenue, as well as how a company stacks up to analyst estimates. These articles are published without human intervention, allowing us to inform our readers of the latest figures as quickly as possible. To report any concerns or inaccuracies, please contact us at <a href="mailto:editor@investorplace.com">editor@investorplace.com</a>.</div><h3>More From InvestorPlace</h3>
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									</ul>The post <a href="https://investorplace.com/earning-results/2024/07/hesm-stock-earnings-hess-midstream-for-q2-of-2024/">HESM Stock Earnings: Hess Midstream Misses EPS, Beats Revenue for Q2 2024</a> appeared first on <a href="https://investorplace.com">InvestorPlace</a>.

HESM Stock Earnings: Hess Midstream Misses EPS, Beats Revenue for Q2 2024

Hess Midstream LP (HESM) Q2 2024 Earnings Call Transcript

In a report released yesterday, Praneeth Satish from Wells Fargo assigned a Hold rating to Hess Midstream Partners (HESM – Research Report), with a...

Wells Fargo Releases a Hold Rating on Hess Midstream Partners (HESM)

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Dividend Champion, Contender, And Challenger Highlights: Week Of August 11

<a href="https://investorplace.com">InvestorPlace - Stock Market News, Stock Advice &amp; Trading Tips</a>
Three <a href="https://investorplace.com/industries/energy/">energy stocks</a> may achieve significant breakthroughs in 2024 based on their robust financial health and strategic advantages. This article highlights three energy stocks with strong fundamentals, making them prime candidates for such breakthroughs.



Operating in high-demand areas like liquefied natural gas (LNG) transportation, these companies are poised to benefit from the global shift toward cleaner energy. Consistent revenue and EBITDA performance in this space underline their potential as LNG trade increases.



The shipping and transportation segment within energy also offers strong investment potential. Companies with solid fixed-rate charter backlogs and high dividend payouts provide financial stability and predictable cash flows, appealing to investors seeking income and growth.



Finally, companies drive growth in the midstream oil and gas infrastructure sector through increased capital expenditures on expanding gas compression and related facilities. These investments, focused on high-return projects, position them well for breakthroughs in 2024 as they meet the growing demand for energy infrastructure.



<h2>FLEX LNG (FLNG)</h2>



<div><img width="300" height="169" src="https://investorplace.com/wp-content/uploads/2022/11/lng-natural-gas-ship-1600-300x169.jpg" alt="Large tanker ship carrying natural gas at dusk in harbor"><div>Source: shutterstock.com/Wojciech Wrzesien</div></div>Flex LNG (NYSE:<a href="https://investorplace.com/stock-quotes/flng-stock-quote/">FLNG</a>) specializes in LNG transportation. The company had net income of&nbsp;<a href="https://mb.cision.com/Main/22886/3986473/2816004.pdf" target="_blank">$33.2 million,&nbsp;</a>with adjusted net income of $37.9 million for Q1 2024. This translates to an EPS of 62 cents with an adjusted EPS of 70 cents. The difference lies in the treatment of interest rate derivatives. Adjusted figures exclude unrealized gains and foreign exchange losses.&nbsp;This&nbsp;shows robust earning capability despite market fluctuations. The company generated revenues of&nbsp;<a href="https://mb.cision.com/Main/22886/3986473/2816004.pdf" target="_blank">$90.2 million in Q1</a>,&nbsp;aligning closely with the guidance of around $90 million. Adjusted EBITDA of $70.6 million exceeded guidance of $70 million.&nbsp;



Additionally, this consistency reflects operational efficiency and effective cost management. These are essential for sustained growth. Flex LNG&rsquo;s dividend strategy is crucial. The company announced a quarterly dividend of 75 cents per share. This amounts to&nbsp;<a href="https://seekingalpha.com/article/4695356-flex-lng-ltd-flng-q1-2024-earnings-call-transcript" target="_blank">$3.125&nbsp;</a>per share over the last four quarters. The dividend yield is around 11%. This consistent dividend payout shows strong cash flow and focuses on returning value.&nbsp;This&nbsp;reinforces investor confidence and supports stock price stability. Flex LNG&rsquo;s robust financials highlight its stability. 



To sum up, consistent dividend payouts show growth potential, which makes Flex LNG one of the top energy stocks.



<h2>SFL (SFL)</h2>



<div><img width="300" height="169" src="https://investorplace.com/wp-content/uploads/2022/03/oil-tanker-1600-300x169.png" alt="Aerial front side view of oil tanker ship sailing on open sea, Imperial Petroleum (IMPP) operates oil tankers"><div>Source: Igor Karasi / Shutterstock.com</div></div>SFL (NYSE:<a href="https://investorplace.com/stock-quotes/sfl-stock-quote/">SFL</a>) focuses on shipping and transportation. Its EBITDA equivalent cash flow was&nbsp;<a href="https://ml-eu.globenewswire.com/Resource/Download/79bf06d5-cd74-4032-ab4c-93c2d187aaea" target="_blank">$152 million</a>&nbsp;in Q1 2024, significantly higher than the previous quarter. The strong EBITDA performance shows operational efficiency and profitability. Net income was $45 million, or 36 cents per share, demonstrating substantial profitability. SFL reported a positive contribution of&nbsp;<a href="https://ml-eu.globenewswire.com/Resource/Download/79bf06d5-cd74-4032-ab4c-93c2d187aaea" target="_blank">$2.2 million&nbsp;</a>to profits on capesize bulk carriers. It also gained $3.3 million from fuel cost savings.



Additionally, there was a $1.8 million mark-to-market gain on interest rate swaps. SFL has a history of returning value to shareholders through dividends. The company announced its 81st consecutive quarterly dividend, increasing the dividend to 27 cents per share.&nbsp;



Further, the fixed-rate charter backlog is about&nbsp;<a href="https://seekingalpha.com/article/4693164-sfl-corporation-ltd-sfl-q1-2024-earnings-call-transcript" target="_blank">$3.6 billion</a>, which provides strong visibility on future cash flows. The backlog is centered around long-term charters to&nbsp;very strong&nbsp;end users and excludes revenues from vessels in the short-term market and new dual-fuel chemical carriers. It also excludes future profit optionality. This extensive backlog ensures steady revenue that supports the company&rsquo;s growth prospects.



To sum up, SFL&rsquo;s strong charter backlog and consistent dividends make it a reliable investment choice among top energy stocks.



<h2>Hess Midstream (HESM)</h2>



<div><img width="300" height="169" src="https://investorplace.com/wp-content/uploads/2021/02/oil-pipeline-1600-300x169.jpg" alt="Pipelines in the desert"><div>Source: bht2000 / Shutterstock.com</div></div>Hess Midstream (NYSE:<a href="https://investorplace.com/stock-quotes/hesm-stock-quote/">HESM</a>) focuses on midstream oil and gas infrastructure. Capital expenditures for Q2 2024 totaled $72.7 million, up from&nbsp;<a href="https://hessmidstream.gcs-web.com/static-files/2504d91d-6670-41ed-b42f-c2a853b21f43" target="_blank">$52.1 million</a>&nbsp;in the prior year. These funds were directed towards expanding gas compression and infrastructure. The increase in capital spending shows Hess Midstream&rsquo;s commitment to growth. Investments in gas compression facilities boost throughput capacity and meet rising demand. The company is progressing on multiyear projects, including two compressor stations and pipelines. Increased capital spending in the year&rsquo;s second half supports ongoing construction and development.



Moreover, Hess Midstream prioritizes returning capital. Since 2021, it has returned&nbsp;<a href="https://hessmidstream.gcs-web.com/static-files/2504d91d-6670-41ed-b42f-c2a853b21f43" target="_blank">$1.75 billion</a>&nbsp;through stock repurchases.&nbsp;This&nbsp;reduced the total unit count by nearly 25%. The reduction in units enhances per-share metrics and increases value. The company increased its distribution per Class A share by 48% since 2021. In 2024, it has increased by over&nbsp;<a href="https://seekingalpha.com/article/4708736-hess-midstream-lp-hesm-q2-2024-earnings-call-transcript" target="_blank">10% year-to-date</a>&nbsp;on an annualized basis, marking a&nbsp;solid&nbsp;focus on delivering market returns. 



Overall, increased capital investment and strong market returns highlight Hess Midstream&rsquo;s focus on growth and solidify its position among top energy stocks.



On the date of publication, Yiannis Zourmpanos did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com&nbsp;<a href="https://investorplace.com/corporate/investorplace-publishing-guidelines/" target="_blank">Publishing Guidelines</a>.



On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
<div>Yiannis Zourmpanos is the founder of Yiazou Capital Research, a stock-market research platform designed to elevate the due diligence process through in-depth business analysis.</div><h3>More From InvestorPlace</h3>
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The post <a href="https://investorplace.com/2024/08/3-energy-stocks-positioned-for-major-breakthroughs-in-2024/">3 Energy Stocks Positioned for Major Breakthroughs in 2024</a> appeared first on <a href="https://investorplace.com">InvestorPlace</a>.

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