$35.38
$94.63
bear $35.38
base $72.96
bull $94.63
margin of safety $48.00
market price* $123.67
DT Midstream owns natural gas pipelines, storage and gathering systems. DTE Energy spun it off in 2021. It earns fees for moving gas; it does not own or trade the gas. The business has two halves. The Pipeline segment is about 55% of revenue, and about 92% of that revenue is firm, reservation-style contracts. It includes the LEAP pipeline in Louisiana's Haynesville basin, which carries gas toward Gulf Coast LNG and industrial buyers; the Washington 10 storage complex and Michigan system; stakes in the NEXUS, Vector and Millennium pipelines; and, since 31 December 2024, the Guardian, Midwestern and Viking interstate pipelines bought for about $1.2 billion. The Gathering segment is the other 45%. It collects gas from wells in the Haynesville (Blue Union) and in Appalachia. About 57% of gathering revenue is fixed demand charges or minimum-volume commitments, and about 36% depends on how much gas actually flows. One customer, Expand Energy (the former Chesapeake and Southwestern), made up about 45% of 2025 revenue. How we measured earnings. We start from operating cash flow. We strip out working-capital swings, deduct stock compensation, and deduct maintenance capital spending. Our method treats capital spending as maintenance unless revenue grew enough in the same year to explain it. DT Midstream spends in large project lumps that pay off a year or more later, so our method counts much of its expansion spending as maintenance. In 2023, for example, $772 million went mainly into Haynesville expansions whose revenue arrived in 2024, and that year shows negative owner earnings. On the same logic, 2025's $426 million of mostly expansion spending is charged as about $403 million of maintenance. That makes our earnings level deliberately conservative. We did not credit revenue from acquisitions as capex-driven growth. That applies to the first full year of Blue Union in 2020 and the $212 million from the acquired pipelines in 2025. Distributions from the joint ventures in excess of their earnings are handled separately. These were about $49 million in 2025. We excluded the one-off debt-financed payouts from NEXUS ($371 million in 2023) and Millennium ($416 million in 2024). Those payouts were funded by new joint-venture debt, and that debt now lowers the ventures' earnings: equity earnings fell $24 million in 2025. Starting point. Owner earnings per share were $1.30 (2020), $5.42 (2021), $3.77 (2022), -$0.47 (2023), $4.02 (2024) and $4.52 (2025). We value the business before its lenders and then subtract the debt, so we add back cash interest. On that basis 2025 produced about $615 million, or $6.00 per share. We anchor on 2025 because it is the only full year that includes the acquired interstate pipelines. Earlier years describe a smaller business: the 2021-2025 median on the same basis is $5.44 without those pipelines. The first half of 2026 supports the level. Revenue rose 11% and operating cash flow 16% from a year earlier. Growth path. Business cash flow per share grew about 10% in 2025. We assume 7% in 2026, which is below that rate. The 2026 gain rests on projects already running: a full year of the LEAP phase 4 expansion (in service September 2025, raising capacity to about 2.1 Bcf/d), the Bluestone-Millennium BEST service (started 1 January 2026), the Stonewall-Mountain Valley interconnect (February 2026) and a Midwestern power-plant lateral. The one large growth project we credit is the Guardian G3 expansion. It adds 537 MMcf/d, about 40% more capacity, is backed by 20-year negotiated-rate agreements with investment-grade utilities, and is due in the fourth quarter of 2028. We credit no new LEAP phases, basin growth or LNG-driven volume, because none is contracted today. Base case ($73 per share). 2026 grows 7%. G3 adds about $40 million a year from 2029. Joint-venture excess distributions of about $45 million a year continue. Gathering cash flow drifts down 1.5% a year from 2028 as fixed commitments roll off. Contracted fixed revenue in the filings falls from $259 million in 2026 to $106 million in 2030, and Bluestone volumes are already declining. Cash taxes rise over 2029-2035 to recapture about half of today's roughly $135 million annual deferral. Continued bonus depreciation on new spending shelters the rest. Once G3 is finished, expansion spending eases by about $60 million a year, since no further growth is credited. The interstate pipelines are long-lived, federally certificated assets on firm contracts, so we let them keep earning at a flat level for 45 years. Gathering declines 3% a year after 2035 and ends by 2065. The business is worth about $10.7 billion. It owes about $3.25 billion, leaving about $7.5 billion for shareholders. Bear case ($35 per share). Only projects already in service lift 2026, by 4%. G3 slips to 2030 and earns $30 million. Expand Energy slows Haynesville development as minimum-volume commitments expire, and gathering cash flow falls 5% a year through 2035 and 4% a year after. Cash taxes rise to the full statutory level of about $130 million by 2034. The 2029 and 2031 notes refinance above 6%. The pipelines earn until 2055 and gathering ends by 2050. The business is worth about $7.0 billion against about $3.4 billion owed, leaving about $3.6 billion. Bull case ($95 per share). 2026 grows 10%. G3 earns $60 million from 2029. The company keeps adding the kind of small, contracted expansions it has repeated on LEAP and Haynesville gathering since 2020, worth about 2% a year from 2030 and tapering to zero by 2035. Regulated pipeline rates follow FERC's annual index at about 1% for 20 years. Only a quarter of the tax deferral reverses. The business is worth about $13.0 billion against about $3.25 billion owed, leaving about $9.7 billion. Debt. Borrowings are $3.35 billion of senior notes: $1.1 billion at 4.125% due June 2029, $1.0 billion at 4.375% due June 2031, $600 million at 4.3% due 2032 and $650 million at 5.8% due December 2034. Long-term debt on the mid-2026 balance sheet ($3.33 billion) is essentially these notes, and cash was $172 million. Most of this debt is fixed below 6% for years, which is worth about $175 million to shareholders. We also deduct about $200 million for the minority owners of a consolidated subsidiary. The company became investment grade in May 2025, and net leverage was 2.9 times under its credit agreement at the end of 2025, so near-term refinancing risk is modest. The 2029 maturity is the main one to watch. Every case covers its interest bill comfortably. What would make this wrong. On the downside: a sharp pullback by Expand Energy in the Haynesville, delay or cost overruns on G3, or a FERC rate case that cuts returns on the regulated pipelines. On the upside: our method counts much of the company's expansion spending as maintenance. If maintenance really runs closer to the roughly $140 million total the company spent in 2021, a year between projects, true earnings power is materially higher than our base case assumes.