Raymond James upgraded Kinetik Holdings Inc. (NYSE:KNTK) to Outperform from Market Perform on January 5, setting a price target of $46. The firm said the midstream sector is entering 2026 with momentum, but after what it called "constructive" share performance in 2025, expectations are now higher. In its view, "the real work now shifts to execution." Investors are focusing less on broad industry tailwinds and more on which companies can turn that backdrop into measurable cash flow.
Kinetik's third-quarter earnings, reported on November 5, showed total operating revenue of $463.9 million, a 17% increase from the same period last year. Product revenue rose to $357.6 million from $290.4 million in the prior-year quarter.
The quarter also saw an operational milestone. Kinetik announced its Kings Landing project officially entered full commercial service, adding processing capacity in New Mexico. CEO Jamie Welch noted that Kings Landing has been consistently running above 100 million cubic feet per day, meeting the company's internal expectations.
On cash flow, Kinetik reported distributable cash flow of $158 million for the quarter, along with free cash flow of $50.9 million. The dividend coverage ratio came in at 1.3x, providing some breathing room even if conditions soften.
Kinetik Holdings Inc. is an American midstream energy company focused on the Permian Basin, with operations in gathering, processing, and related infrastructure supporting production growth in the region.