Western Midstream Partners (WES): Is the Stock Undervalued After Recent Slide?

Western Midstream Partners (WES) has quietly slid about 2% over the past month as investors sift through a mix of solid revenue growth and shifting sentiment in the energy sector. The stock’s longer-term returns, however, tell a different story.

See our latest analysis for Western Midstream Partners.

Western Midstream Partners’ latest slide reflects softening momentum in the share price. However, when you zoom out, the partnership’s 1-year total return of 7.6% and impressive 5-year total return of over 550% illustrate just how powerful long-term performance can be, even amid short-term nerves.

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With shares now trading just below analyst targets and steady growth in revenues and income, is Western Midstream Partners flying under the radar as an undervalued pick, or is the market already pricing in its future gains?

Most Popular Narrative: 6.8% Undervalued

The most widely followed narrative points to a valuation edge for Western Midstream Partners, with its fair value estimated at $40.33, which is above the last close of $37.60. A blend of infrastructure growth and steady margins has set the stage for a rating that could catch bullish investors’ eyes.

Investment in major long-term capacity expansions, such as the Pathfinder pipeline and North Loving II plant, are set to come online in 2027, adding significant processing and transport capability. These are expected to materially increase revenues and cash flows in subsequent years.

Read the complete narrative.

Curious what financial leaps are powering this valuation? The narrative’s foundation is built on bold expansion moves and projections that defy typical sector expectations. Uncover which ambitious assumptions are fueling these price forecasts, and why this story could surprise even seasoned investors.

Result: Fair Value of $40.33 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, risks remain if oil and gas production weakens or if Western Midstream’s major projects face delays. Both of these factors could hamper future returns.

Find out about the key risks to this Western Midstream Partners narrative.

Build Your Own Western Midstream Partners Narrative

If you think there’s another angle or want to dive into the numbers yourself, it’s easy to form your own narrative in just a few minutes. Do it your way.

A great starting point for your Western Midstream Partners research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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