Hess Midstream LPHESM +1.22%67 Operating Margin % is 61.26% as of Mar. 2026, which is 8% above its 10-year median of 56.77. GuruFocus rates HESM with a GF Score™ of 67/100 and a GF Value™ of $24.43 (Significantly Overvalued). The stock has 8 warning signs investors should review. Among 916 Oil & Gas companies, Hess Midstream LP ranks better than 97.6% on this metric.
Just like Gross Margin %, it is important to see a company maintains its operating margin over time. Among the same industry, a company with higher operating margin is more efficient in its operation. It is also more stable during industry slowdown or recessions. Peter Lynch prefers those with higher margins than those with lower margins.
Be Aware
Operating Margin % can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).
If a company is facing competition, its Operating Margin % may decline. Often the Operating Margin % declines well before the company's Revenue or even profit decline. Therefore, Operating Margin % is a very important indicator of whether the company is facing problems.
For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokias Operating Margin % had already been in decline since 2002, although its Earnings per Share (Diluted) were still rising. Investors who paid attention to Operating Margin % would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).
Therefore, Operating Margin % is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.
Hess Midstream LP Operating Margin % Related Terms
Hess Midstream LP Operating Margin % Historical Data
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The historical data trend for Hess Midstream LP's Operating Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
HESM vs PAGP, GLNG, INSW: Operating Margin % Comparison
For the Oil & Gas Midstream subindustry, Hess Midstream LP's Operating Margin %, along with its competitors' market caps and Operating Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Hess Midstream LP Operating Margin % vs Oil & Gas Industry
For the Oil & Gas industry and Energy sector, Hess Midstream LP's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Hess Midstream LP's Operating Margin % falls into.
Operating Margin % - also known as operating income margin, operating profit margin and return on sales (ROS) - is the ratio of Operating Income divided by net sales or Revenue, usually presented in percent.
Hess Midstream LP's Operating Margin % for the fiscal year that ended in Dec. 2025 is calculated as
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Hess Midstream LP (HESM) has a Operating Margin % of 61.26% as of Mar. 2026. Operating margin is the ratio of total operating income to net sales. View historical data on Hess Midstream LP and its competitors. This is near median its historical median of 56.77. Over the past decade, Hess Midstream LP's Operating Margin % has ranged from 40.47 to 62.34. According to the industry distribution chart, Hess Midstream LP ranks #22 out of 916 companies in the Oil & Gas industry, placing it in the top 2.4%.
Is Hess Midstream LP's Operating Margin % too high?
Hess Midstream LP's current Operating Margin % of 61.26% is near median its 10-year median of 56.77. Over the past 10 years, this metric has ranged from a low of 40.47 to a high of 62.34. The Oil & Gas industry median Operating Margin % is 6.86. Hess Midstream LP's value of 61.26% is 793% above this industry median. Based on the distribution chart, Hess Midstream LP ranks #22 out of 916 companies in the Oil & Gas industry, which is in the top quartile — a strong position relative to peers. Overall, Hess Midstream LP has a GF Score™ of 67/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Hess Midstream LP's Operating Margin % compare to PAGP and GLNG?
According to the Oil & Gas industry distribution chart, Hess Midstream LP ranks #22 out of 916 companies for Operating Margin %. This places Hess Midstream LP in the top 2% of its industry — outperforming the majority of peers. The industry median Operating Margin % is 6.86. Hess Midstream LP's value of 61.26% is 793% above this benchmark. Historically, Hess Midstream LP's own Operating Margin % has ranged from 40.47 to 62.34 over the past decade. While the company's 10-year median is 56.77 vs. the industry median of 6.86, Hess Midstream LP has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Operating Margin % for an Oil & Gas company?
The median Operating Margin % among Oil & Gas companies is 6.86, based on 916 companies in the industry. Companies in the top quartile (top 25%) have a Operating Margin % significantly above this median, while those in the bottom quartile fall well below. However, Operating Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Hess Midstream LP's current Operating Margin % of 61.26% is 793% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Operating Margin % mean?
A high Operating Margin % can signal that a stock is expensive relative to its fundamentals. Operating margin is the ratio of total operating income to net sales. View historical data on Hess Midstream LP and its competitors. For the Oil & Gas industry, the median Operating Margin % is 6.86 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Hess Midstream LP's current Operating Margin % is 61.26%, which is near median its own 10-year median of 56.77. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Hess Midstream LP stock overvalued right now?
Based on GuruFocus' analysis, Hess Midstream LP (HESM) is currently considered Significantly Overvalued. The stock's GF Value™ is $24.43, compared to a current price of $37.74 — trading 54.5% above its estimated fair value. The current Operating Margin % is 61.26%, which is near median its 10-year median of 56.77 and 793% above the Oil & Gas industry median of 6.86. Hess Midstream LP's overall GF Score™ is 67/100 with 8 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Operating Margin % calculated?
Operating Margin % is calculated from a company's financial statements. For Hess Midstream LP (HESM), the current Operating Margin % is 61.26% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Hess Midstream LP (HESM) Overvalued in 2026?
Based on GuruFocus' analysis, Hess Midstream LP stock appears to be overvalued.
The current stock price of $37.74 is trading 54.5% above its estimated GF Value™ of $24.43.
GuruFocus considers Hess Midstream LP to be Significantly Overvalued.
Key valuation signals for HESM:
Operating Margin %: 61.26% (near median its 10-year median of 56.77)
GF Value™: $24.43 vs. price of $37.74 (54.5% above fair value)
Industry Position: 793% above the Oil & Gas median (#22 of 916)
No single metric tells the full story. See the HESM stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Hess Midstream LP is a fee-based, growth-oriented limited partnership that owns, operates, develops, and acquires a portfolio of midstream assets. The company provides fee-based services to Chevron Corporation and generates all of its revenue by charging fees for gathering, compressing, and processing natural gas, fractionating NGLs, gathering, terminaling, loading, and transporting crude oil and NGLs, storing and terminaling propane, and gathering and disposing of produced water. It operates through gathering, processing, and storage, and terminaling and export segments, with the gathering segment contributing the maximum share of revenue and comprising natural gas gathering and compression, as well as crude oil gathering and produced water gathering and disposal assets.
67GF Score
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