3. Western Midstream Partners LP (NYSE:WES)
Net Profit Margin: 30.99%
Western Midstream Partners, LP (NYSE: WES) ranks third among the most profitable energy stocks to buy now, with a net profit margin of 30.99%. Western Midstream Partners, LP (NYSE: WES) operates as a midstream energy company primarily in the United States, giving it exposure to the critical infrastructure that supports oil, natural gas, and natural gas liquids movement across major production regions. For investors searching for midstream energy stocks, pipeline stocks, profitable energy infrastructure companies, Permian Basin stocks, and high-margin energy stocks, Western Midstream Partners, LP (NYSE: WES) stands out as one of the more profitable names in the group.
Midstream energy companies like Western Midstream Partners, LP (NYSE: WES) are often less understood by casual investors, but they play a vital role in the energy system. Producers can drill wells and bring hydrocarbons to the surface, but those products still need to be gathered, processed, transported, and connected to end markets. That is where midstream companies come in. They are the bridge between upstream production and downstream use, and in periods of strong energy activity, their assets can become even more valuable.
On May 27, Morgan Stanley raised its price target on Western Midstream Partners, LP (NYSE: WES) from $41 to $51, while keeping an “Underweight” rating on the shares. The target adjustment indicates upside potential of more than 17% from the recent price of $43.94. The combination of a higher price target and an Underweight rating may look unusual at first glance, but it reflects a common Wall Street nuance: an analyst can recognize near-term upside or stronger fundamentals while still preferring other names within the same coverage universe.
Western Midstream Partners, LP (NYSE: WES) delivered a strong Q1 report last month, exceeding expectations due to several important drivers. The company benefited from the contribution of its Aris acquisition, per-day throughput growth across all three product lines, and continued success in cost-cutting efforts. These are not small details. For a midstream company, throughput growth means more product is moving through the system, while cost control can directly improve margins and cash flow.
The company’s adjusted gross margin also received a boost from the significant rise in crude oil prices in March. While midstream companies are often seen as more fee-based and less directly exposed to commodity prices than producers, stronger crude prices can still improve activity levels, producer confidence, and system utilization. When drilling activity and production volumes remain healthy, companies like Western Midstream Partners, LP (NYSE: WES) can benefit from stronger demand for gathering, processing, and transportation services.
Western Midstream Partners, LP (NYSE: WES) also announced the acquisition of privately held Brazos Delaware II in a $1.6 billion deal last month. This transaction further reinforces the company’s gathering and processing footprint in the core of the Permian Basin, one of the most important oil-producing regions in the United States. The Permian Basin remains a major focus for investors because of its scale, productivity, infrastructure needs, and long-term role in U.S. energy supply.
The Brazos Delaware II acquisition gives Western Midstream Partners, LP (NYSE: WES) a stronger position in a basin that continues to attract capital and strategic interest. In the midstream sector, scale matters. More assets in key regions can mean stronger customer relationships, better system integration, and more opportunities to capture volumes. For Western Midstream Partners, LP (NYSE: WES), the deal strengthens its role in one of the most competitive and valuable energy regions in North America.
The company plans to provide updated guidance for fiscal 2026 together with its Q2 results after the Brazos deal closes. That upcoming guidance will be important for investors because it should give a clearer picture of how management expects the acquisition to affect earnings, cash flow, and operating performance. For now, Western Midstream Partners, LP (NYSE: WES) already holds a strong position on this list because of its 30.99% net profit margin.
For investors looking for energy stocks with strong cash flow, profitable midstream stocks, Permian Basin infrastructure plays, and energy companies with high margins, Western Midstream Partners, LP (NYSE: WES) offers a direct way to participate in the infrastructure side of the oil and gas market. It may not get the same headlines as the major oil producers, but in a supply-constrained and infrastructure-heavy energy market, Western Midstream Partners, LP (NYSE: WES) is exactly the kind of company that deserves a closer look.
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