USA Compression Partners LP
NYSE:USAC
USA Compression Partners LP
USA Compression Partners LP, deep-rooted in the energy landscape, operates as one of the top providers of compression services across the United States. Founded with the vision to support the burgeoning natural gas industry, the company's operations are pivotal for the transportation and storage segments of the midstream sector. The art and science of compression are critical for moving natural gas from production sites to refineries and distribution hubs. Imagine a vast network where natural gas needs to be pressured to keep moving through pipelines – this is where USA Compression steps in. They strategically deploy compression units to elevate gas pressure, ensuring it flows seamlessly through the matrix of pipelines that crisscross the country, akin to the veins of an economy heavily reliant on energy.
The financial heartbeat of USA Compression Partners thrives on long-term service contracts largely insulated from the fluctuating prices of natural gas itself. By securing multi-year agreements with a variety of energy companies, the firm ensures a steady cash flow and robust revenue streams. These contracts typically entail the leasing of their compression units, along with technical support and maintenance services, tailored to meet specific field requirements. As such, USA Compression not only fills a logistic gap in the energy supply chain but also adheres to a business model that prizes consistency and resilience. Their ability to generate income rests on the reliability and efficiency of their compression equipment, making them indispensable partners in the sustainable transportation of one of the world's most vital energy sources.
USA Compression Partners LP, deep-rooted in the energy landscape, operates as one of the top providers of compression services across the United States. Founded with the vision to support the burgeoning natural gas industry, the company's operations are pivotal for the transportation and storage segments of the midstream sector. The art and science of compression are critical for moving natural gas from production sites to refineries and distribution hubs. Imagine a vast network where natural gas needs to be pressured to keep moving through pipelines – this is where USA Compression steps in. They strategically deploy compression units to elevate gas pressure, ensuring it flows seamlessly through the matrix of pipelines that crisscross the country, akin to the veins of an economy heavily reliant on energy.
The financial heartbeat of USA Compression Partners thrives on long-term service contracts largely insulated from the fluctuating prices of natural gas itself. By securing multi-year agreements with a variety of energy companies, the firm ensures a steady cash flow and robust revenue streams. These contracts typically entail the leasing of their compression units, along with technical support and maintenance services, tailored to meet specific field requirements. As such, USA Compression not only fills a logistic gap in the energy supply chain but also adheres to a business model that prizes consistency and resilience. Their ability to generate income rests on the reliability and efficiency of their compression equipment, making them indispensable partners in the sustainable transportation of one of the world's most vital energy sources.
Record Results: USA Compression posted record full year adjusted EBITDA of $613.8 million and distributable cash flow of $385.7 million, both above recently increased guidance.
J-W Power Acquisition: The acquisition of J-W Power closed in January 2026, broadening the company’s reach and adding significant assets, including a manufacturing business and around 200,000 idle horsepower.
Strong Utilization: Fleet utilization remained high, averaging 94.5% for the year and quarter.
Margin & Synergy Outlook: J-W integration is expected to deliver $10–20 million in annual run rate synergies by 2027; near-term margins may dip as acquired assets are brought in line.
2026 Guidance Raised: Forecasting 2026 adjusted EBITDA of $770–800 million and distributable cash flow of $480–510 million, reflecting a full year of J-W contribution.
Expansion Initiatives: Budgeting 105,000 new horsepower in 2026, with most growth occurring in the back half of the year and ongoing investments in technology upgrades.
Balance Sheet Improvement: Leverage ratio reduced to 4.0x with a near-term target of 3.75x; distribution coverage improved to a normalized 1.55x, aiming for 1.6x+ in 2026.
