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Hess Midstream LP heads into its October 29 Q3 earnings with a notable divergence: short interest has risen nearly 19% over the past month, yet the borrow market remains loose and the stock has gained ground this week.
The most significant development this week came from JP Morgan. Analyst Jeremy Tonet downgraded HESM to Underweight on October 2, keeping his target at $39, roughly in line with the current price of $38.69. That follows a Morgan Stanley downgrade to Underweight in June and a Goldman Sachs move to Sell in April, with a $32 target. The analyst community has skewed steadily negative through 2026. The consensus sits at hold, with four hold ratings and one underperform. No buy ratings are on record. The factor scores reflect that skepticism: analyst recommendation differential ranks in just the 4th percentile, placing HESM near the bottom of its peer universe on Street sentiment. EV/EBIT is more constructive, ranking in the 69th percentile, and the dividend score comes in at the maximum of 100, consistent with the stock's income appeal to yield-focused holders.
Short positioning tells a more nuanced story. At 6.2% of free float, short interest is not extreme, but the trajectory stands out. Borrowed shares have climbed roughly 19% over the past month, with the most visible step-up occurring in late September, when the position jumped from around 6.6 million to 7.9 million shares in the space of three trading days. Despite that build, the borrow market is nowhere near stressed. Availability runs near 497% of current short interest, meaning nearly five times as many shares are available to borrow as are currently lent out. That is well above the 52-week low of 112%. Cost to borrow is 0.45%, down sharply from recent highs above 0.55% earlier in the week. No squeeze mechanics are visible here. The ORTEX short score of 53.3 is mid-range and has drifted slightly lower over the past week, consistent with a position that is building slowly rather than aggressively.
Options positioning is the most unusual feature of the current setup. The put/call ratio of 3.29 is structurally elevated, running roughly three times the level of most midstream peers, though it sits just below its 20-day average of 3.54 and well below the 52-week high of 4.61 hit on September 21. The z-score of -0.74 places the current reading below recent norms, suggesting put demand has actually cooled slightly from its peak. For context, the ratio collapsed from 0.38 at the end of August to above 3.0 by early September and has held there. That shift coincided closely with the Goldman Sell call in April and the Morgan Stanley downgrade in June accumulating in the market's positioning calculus. The elevated PCR is more a structural feature of how HESM's options market has repriced in 2026 than a fresh spike driven by this week's news.
On ownership, three 13D filers remain on the register. Hess Investments North Dakota LLC holds 37.8% of the class, a controlling stake that has been stable. GIP II Blue Holding filed a 13D/A in January 2025 disclosing a 23.2% position. ALPS Advisors, the largest institutional holder at roughly 22.8% of shares, slightly trimmed its stake as of July. BlackRock Portfolio Management filed a 13D/A in May 2025 showing its position had fallen from 11.9% to 0.3%, a material reduction that suggests a structural exit by one formerly significant holder. As always, 13D/G disclosures are event-driven and positions may have changed since last filing. Insider data is stale as of March 2026 and the most recent transactions were routine option exercises and tax withholding events, not conviction trades.
Price reactions around past HESM earnings prints have been contained. The August 2026 result produced a 1.3% decline on the day and a further drift to -0.5% over five sessions. The prior print, in late July, added 0.7% on the day. The range of recent outcomes is narrow, which fits the nature of a fee-based midstream operator with contracted throughput. The Q3 report on October 29 will arrive into a setup where the Street has turned more negative, short interest has rebuilt modestly, and the closest peers, including KMI up 5.6% on the week and EPD up 3.4%, have outperformed HESM's 2.8% weekly gain. Whether the October print changes the analyst calculus, particularly for JP Morgan's freshly minted Underweight, is the next thing to watch.
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