Raymond James upgrades Hess Midstream with $32 price target

Raymond James has upgraded its rating for Hess Midstream, setting a new price target of $32 per share. The analyst firm suggests that recent market losses following a contract restructuring with Chevron were excessive.

The revaluation centers on a deal where Chevron will accept lower Bakken fees for the period between 2027 and 2033. In exchange, the commitment to utilize Hess Midstream’s infrastructure has been extended through 2045. While the lower fees have led to reduced adjusted EBITDA forecasts, the extended contract duration provides long-term volume stability and reduces planning risks.

Following the upgrade, Hess Midstream shares rose by 1.9% on Friday. Analysts note that the upgrade represents a valuation opportunity rather than a fundamental shift in operational risk, as the market appears to have over-priced the impact of the new fee structure.