Core Viewpoint - Western Midstream Partners, LP (WES) offers an attractive dividend yield of nearly 9.5%, which may indicate potential investment opportunities despite market sentiment and technical factors being prioritized over fundamentals [1]. Company Analysis - The high dividend yield of WES is a significant factor that draws investor attention, suggesting that the company may be undervalued or overlooked in the current market [1]. - The analysis emphasizes a fundamentals-first approach, indicating that the company's financial health and performance metrics are critical in evaluating its investment potential [1]. Market Context - The investment environment is increasingly influenced by algorithm-driven strategies, which may overshadow fundamental analysis, highlighting the importance of a balanced approach to investment decisions [1].

Core Insights - Western Midstream Partners, LP (WES) will release a post-earnings interview with CFO Kristen Shults to provide insights on Q3 2025 results [1] - WES is scheduled to participate in several investor conferences in Q4 2025 and Q1 2026 [2][4] - The company operates midstream assets across multiple states and has a business model that minimizes exposure to commodity price volatility through fee-based contracts [2] Financial Performance - WES announced record financial and operating results for Q3 2025, highlighting strong net income [3][5] Investor Engagement - WES will engage with investors at various conferences, including the Daniel Energy Partners Executive Series and the Mizuho Power, Energy, and Infrastructure Conference [4]

Group 1 - Western Midstream Partners (WES) is identified as an attractive investment opportunity within the midstream sector, particularly due to its core assets located in the Delaware River Basin [1] - The company's growth strategy focuses on expanding its asset portfolio through acquisitions and infrastructure development [1] Group 2 - The analysis emphasizes the importance of combining macro-economic insights with practical trading experience to identify profitable investment opportunities [1]

Core Insights - Western Midstream Partners, LP (NYSE:WES) is recognized as one of the 15 Extreme Dividend Stocks to Buy According to Hedge Funds [1] - Stifel analyst raised the price target for WES from $41 to $43 following strong Q3 results and the successful integration of Aris Water Solutions [2] - The company reported record natural gas throughput in the Delaware Basin and projected $40 million in annual synergy savings from the Aris acquisition [3] Financial Performance - WES expects to reach the upper end of its previously guided 2025 adjusted EBITDA range of $2.35 billion to $2.55 billion, with an estimated contribution of $45 million to $50 million from Aris in Q4 [4] - The revised price target reflects the firm's 2026 outlook, factoring in the Aris acquisition [2] Strategic Developments - The completion of the Aris Water Solutions acquisition is seen as a key step in strengthening WES's position as a leading three-stream midstream provider [3] - Integration of Aris is progressing well, contributing positively to the company's operational capabilities [3]

Core Insights - The article discusses extreme dividend stocks, focusing on high-yield and dividend growth categories, highlighting the potential risks and benefits associated with high dividend yields [2][4]. Dividend Stock Categories - Dividend-focused indices are categorized into dividend growth and high yield, with high-yield stocks attracting income-seeking investors but facing reinvestment challenges [2]. - S&P 500 Dividend Aristocrats, which have increased dividends for at least 25 consecutive years, show steady growth in payouts even during market downturns, offering stronger yield-on-cost over time [3]. Performance of High Yield Dividend Stocks - The S&P Sector-Neutral High Yield Dividend Aristocrats (HYDA) index balances dividend growth with higher yields, achieving better risk-adjusted returns and reducing maximum drawdown by about 5% from January 2005 to July 2023 [4]. Methodology for Stock Selection - The stock screener selected dividend stocks with yields between 6% and 14% as of November 11, focusing on companies with stable dividend histories, although many have inconsistent records due to high yields [6]. - The final list includes companies favored by hedge fund investors, ranked in ascending order based on popularity [6][7]. Company Highlights - **Sunoco LP (NYSE:SUN)**: - Dividend yield of 7.34% as of November 11, with a recent $9 billion acquisition of Parkland Corporation, creating the largest independent fuel distributor in the Americas [9][10]. - Reported Q3 2025 revenue of $6.03 billion, a nearly 5% increase year-over-year, and raised its quarterly distribution by 1.25% [11][12]. - **Western Midstream Partners, LP (NYSE:WES)**: - Dividend yield of 9.18% as of November 11, with a recent price target increase from $41 to $43 by Stifel [13][14]. - Q3 2025 results exceeded expectations, with a projected adjusted EBITDA range of $2.35 billion to $2.55 billion for 2025, including contributions from the Aris acquisition [15][16]. - **Barings BDC, Inc. (NYSE:BBDC)**: - Dividend yield of 11.66% as of November 11, with a recent price target cut to $9.50 while maintaining a Market Perform rating [17]. - Reported total investment income of $72.4 million and net investment income of $33.6 million for Q3 2025, with a quarterly dividend of $0.26 per share [18][19].

Core Insights - During market turbulence, investors often seek dividend-yielding stocks, which typically have high free cash flows and offer substantial dividends [1] Company Summaries Vitesse Energy Inc (NYSE:VTS) - Dividend Yield: 10.41% - Evercore ISI Group analyst Chris Baker maintained an In-Line rating and reduced the price target from $22 to $20 on October 6, 2025, with an accuracy rate of 69% [7] - Roth MKM analyst John White maintained a Buy rating and increased the price target from $30.5 to $33 on April 2, 2025, with an accuracy rate of 63% [7] - Recent News: Mixed quarterly results reported on November 3 [7] Western Midstream Partners LP (NYSE:WES) - Dividend Yield: 9.18% - Citigroup analyst Spiro Dounis reinstated a Neutral rating with a price target of $39 on October 20, 2025, with an accuracy rate of 75% [7] - Mizuho analyst Gabriel Moreen maintained an Outperform rating and raised the price target from $44 to $46 on August 29, 2025, with an accuracy rate of 68% [7] - Recent News: Weak quarterly results reported on November 4 [7] Plains All American Pipeline LP (NASDAQ:PAA) - Dividend Yield: 9.09% - Raymond James analyst Justin Jenkins reiterated a Strong Buy rating and cut the price target from $24 to $22 on October 24, 2025, with an accuracy rate of 78% [7] - Barclays analyst Theresa Chen maintained an Underweight rating and reduced the price target from $18 to $17 on October 7, 2025, with an accuracy rate of 75% [7] - Recent News: Announced the pricing of a public offering of $750 million of senior notes on November 10 [7]

Financial Data and Key Metrics Changes - The company generated net income attributable to limited partners of $332 million and adjusted EBITDA of $634 million in Q3 2025, with adjusted gross margin remaining relatively flat compared to the previous quarter [17][20] - Operating and maintenance expenses decreased by 5%, or $12 million quarter-over-quarter, due to reduced asset maintenance and repair expenses [17][18] - Cash flow from operating activities totaled $570 million, generating free cash flow of $397 million [19] Business Line Data and Key Metrics Changes - Natural gas throughput increased by 2% sequentially, driven by higher throughput from the Chipeta plant in Utah and increased volumes in South Texas [7] - Crude oil and NGLs throughput decreased by 4% sequentially, primarily due to decreased throughput from the Delaware Basin [8] - Produced water throughput remained flat sequentially, with expectations for a 40% year-over-year increase in Q4 2025 due to the Aris acquisition [10][19] Market Data and Key Metrics Changes - The Delaware Basin throughput was in line with expectations, with low double-digit year-over-year growth anticipated for natural gas and low to mid-single digits for crude oil and NGLs [10][12] - The DJ Basin is expected to see flat year-over-year throughput growth for natural gas and low to mid-single digits for crude oil and NGLs [12] - The Powder River Basin is projected to have flat throughput growth for both natural gas and crude oil and NGLs [12] Company Strategy and Development Direction - The acquisition of Aris Water Solutions positions the company as a leader in produced water midstream solutions in the Delaware Basin, enhancing its commercial capabilities [4][24] - The company aims to capture $40 million in annual run rate synergies from the Aris acquisition and is focused on organic growth alongside potential inorganic opportunities [4][15][67] - The company is maintaining a disciplined capital allocation framework while planning for significant capital expenditures in 2026 [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to address produced water challenges in the Delaware Basin and highlighted the importance of regulatory engagement [4][24] - The company anticipates continued throughput growth in the Delaware Basin, driven by the Aris acquisition and ongoing projects [10][15] - Management acknowledged potential commodity price weakness impacting certain basins but remains optimistic about overall growth prospects [12][58] Other Important Information - The company expects to be at the high end of its previously announced 2025 adjusted EBITDA guidance range of $2.35 billion to $2.55 billion, including contributions from Aris [20] - The company declared a quarterly distribution of $0.91 per unit, consistent with the prior quarter [19] Q&A Session Summary Question: Discussion on O&M expense sustainability - Management confirmed that the reduction in O&M expenses is sustainable and ongoing cost management initiatives are expected to yield further improvements [30][34] Question: Potential for distribution step-ups with major projects - Management indicated that distribution step-ups are possible with major projects or acquisitions, but will be balanced against market conditions and yield considerations [35][37] Question: Update on the Pathfinder project and pore space agreement - Management noted that the pore space agreement enhances project efficiency and flexibility, with positive implications for returns [40][41] Question: Plans for expanding gas and oil infrastructure in New Mexico - Management plans to pursue both organic and inorganic growth opportunities in New Mexico, leveraging the Aris footprint [45][46] Question: Outlook for 2026 and potential portfolio gaps - Management expects overall product growth across all three product lines in 2026, with a focus on the Delaware Basin and cost-cutting initiatives [56][58] Question: Synergies from the Aris acquisition - Management is confident in achieving the $40 million in synergies and anticipates additional operational synergies to emerge in the near term [64][67]

Financial Data and Key Metrics Changes - The company reported net income attributable to limited partners of $332 million and adjusted EBITDA of $634 million for Q3 2025, with adjusted gross margin remaining relatively flat compared to the previous quarter [17][20] - Operating and maintenance expenses decreased by 5%, or $12 million, quarter over quarter, attributed to reduced asset maintenance and repair expenses [17][18] - Cash flow from operating activities totaled $570 million, generating free cash flow of $397 million [19] Business Line Data and Key Metrics Changes - Natural gas throughput increased by 2% sequentially, driven by higher volumes from the Chepeta plant in Utah and the DJ Basin [7][10] - Crude oil and NGLs throughput decreased by 4% sequentially, primarily due to reduced throughput in the Delaware Basin [8] - Produced water throughput remained flat sequentially, with expectations for a 40% year-over-year increase in Q4 2025 due to the Aris acquisition [10][12] Market Data and Key Metrics Changes - The Delaware Basin throughput was in line with expectations, with low double-digit year-over-year growth anticipated for natural gas and low to mid-single digits for crude oil and NGLs [10][11] - The DJ Basin is expected to see flat growth for natural gas and low to mid-single digits for crude oil and NGLs [12] - The Powder River Basin is projected to have flat throughput growth for both natural gas and crude oil and NGLs [12] Company Strategy and Development Direction - The acquisition of Aris Water Solutions positions the company as a leader in produced water midstream solutions in the Delaware Basin, enhancing its commercial capabilities [4][24] - The company aims to capture $40 million in annual run rate synergies from the Aris acquisition and is focused on organic growth alongside potential inorganic opportunities [4][15][67] - The company plans to maintain a disciplined capital allocation framework while pursuing growth opportunities in both Texas and New Mexico [25][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to address produced water challenges in the Delaware Basin and highlighted the importance of regulatory engagement [4][24] - The company anticipates continued throughput growth in the Delaware Basin, driven by the Aris acquisition and ongoing projects like the Pathfinder pipeline [10][14] - Management acknowledged potential commodity price weakness impacting certain basins but remains optimistic about overall growth prospects [12][58] Other Important Information - The company expects capital expenditures to be at least $1.1 billion in 2026, with a focus on supporting throughput growth across all product lines [22] - The company declared a quarterly distribution of $0.91 per unit, consistent with the prior quarter [19] Q&A Session Summary Question: Discussion on O&M expense sustainability - Management indicated that the reduction in O&M expenses is sustainable and that further improvements are expected [30][34] Question: Potential for distribution step-ups with major projects - Management confirmed that distribution step-ups are possible with successful project completions or acquisitions, while being mindful of yield levels [35][37] Question: Update on the Pathfinder project and pore space agreement - Management noted that the pore space agreement enhances project efficiency and allows for better growth potential in New Mexico [40][41] Question: Plans for expanding gas and oil infrastructure in New Mexico - Management plans to pursue both organic and inorganic growth opportunities in New Mexico, leveraging the Aris acquisition [45][46] Question: Insights on synergies from the Aris acquisition - Management expressed confidence in achieving the $40 million synergy target and anticipates additional operational synergies [64][67]

Financial Data and Key Metrics Changes - The company generated net income attributable to limited partners of $332 million and adjusted EBITDA of $634 million during Q3 2025, with adjusted gross margin remaining relatively flat compared to the previous quarter [16][19] - Operating and maintenance expenses decreased by 5%, or $12 million, quarter over quarter, attributed to reduced asset maintenance and repair expenses [16][18] - Cash flow from operating activities totaled $570 million, generating free cash flow of $397 million [18] Business Line Data and Key Metrics Changes - Natural gas throughput increased by 2% sequentially, driven by higher volumes from the Chepeta plant in Utah and the DJ Basin [6][10] - Crude oil and NGLs throughput decreased by 4% sequentially, primarily due to reduced throughput in the Delaware Basin [8][10] - Produced water throughput remained flat sequentially, with expectations for a 40% year-over-year increase in Q4 2025 due to the Aris acquisition [10][12] Market Data and Key Metrics Changes - The Delaware Basin achieved record natural gas throughput, while the DJ Basin showed strong sequential growth [3][6] - The Powder River Basin experienced decreased throughput due to previously unloaded volumes subsiding [7][12] - The company expects low double-digit year-over-year throughput growth for natural gas in the Delaware Basin and low to mid-single digits for crude oil and NGLs [10][12] Company Strategy and Development Direction - The acquisition of Aris Water Solutions positions the company as a leader in produced water midstream solutions in the Delaware Basin, enhancing commercial capabilities [4][22] - The company aims to capture $40 million in annual run rate synergies from the Aris acquisition and is focused on organic growth alongside potential inorganic opportunities [4][14][67] - The company plans to maintain a disciplined capital allocation framework while pursuing growth opportunities in both Texas and New Mexico [24][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to address produced water challenges in the Delaware Basin and highlighted the importance of regulatory engagement [4][22] - The company anticipates continued throughput growth in 2026, particularly in the Delaware Basin, despite potential declines in the Powder River Basin due to commodity price weakness [14][57] - Management emphasized the successful execution of cost reduction initiatives, which are expected to continue benefiting the company in 2026 [17][58] Other Important Information - The company expects capital expenditures to be at least $1.1 billion in 2026, with budgeting processes already underway [20] - The company declared a quarterly distribution of $0.91 per unit, consistent with the prior quarter [18] Q&A Session Summary Question: Discussion on O&M expense sustainability - Management indicated that the reduction in O&M expenses is sustainable and that further improvements are expected [28][29][33] Question: Potential for distribution step-ups with major projects - Management confirmed that distribution step-ups are possible with the completion of major projects or acquisitions, while maintaining a cautious approach to yield management [34][36] Question: Update on the Pathfinder project and pore space agreement - Management noted that the pore space agreement enhances project efficiency and allows for better growth potential in New Mexico [40][41][42] Question: Plans for expanding gas and oil infrastructure in New Mexico - Management stated that both organic and inorganic growth strategies will be pursued to expand infrastructure in New Mexico [44][46] Question: Outlook for 2026 and potential portfolio gaps - Management expects overall product growth across all three product lines in 2026, with a focus on leveraging the Aris acquisition for growth [55][57]

Financial Performance - Western Midstream achieved a record total natural-gas throughput of 55 billion cubic feet per day[13] - The company reported record Adjusted EBITDA of $634 million in Q3 2025, a 3% quarter-over-quarter increase[13] - Operating cash flow increased to $5702 million in Q3 2025 from $564 million in Q2 2025[34] - Free cash flow increased to $3974 million in Q3 2025 from $3884 million in Q2 2025[34] - The company's net income for Q3 2025 was $332 million[36] Strategic Growth & Capital Allocation - The company is targeting organic capital projects that meet or exceed mid-teens, unlevered rates of return[40] - The company anticipates free cash flow to be in the range of $1275 billion to $1475 billion for 2025[44] - The company is targeting mid-to-low single-digit annual distribution increases[41] - The company's estimated throughput growth rate for produced water is approximately 40% for 2025[47] Assets and Operations - The North Loving II project, a 300 million cubic feet per day cryogenic processing train, is expected to be in service in Q2 2027[18] - The Pathfinder Pipeline, with a capacity of approximately 800 thousand barrels per day, is expected to be in service in Q1 2027[18] - The company's market capitalization is approximately $153 billion[8]