USA Compression Partners Acquires J-W Power Company for $860M
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 01 2025
0mins
Should l Buy USAC?
USA Compression Partners entered into a definitive agreement to acquire J-W Power Company, a large privately-held provider of compression services in the United States, for total consideration of approximately $860M. Strategic and Financial Benefits: Expanded Scale: Creates a combined fleet of approximately 4.4 million active horsepower. Enhances Geographic Diversification: Adds over 0.8 million active horsepower across key regions including the Northeast, Mid-Con, Rockies, Gulf Coast, Bakken and Permian Basin. Diversified Business Lines: Includes aftermarket services and parts distribution, as well as additional optionality associated with specialized manufacturing services. Customer Base: Highly diversified, high-quality customer base with long-term relationships. Market Leadership: Expands USAC's position across mid-to-large horsepower compression. Financial Impact: Meaningful near-term accretion on a Distributable Cash Flow basis. Valuation: Attractive ~5.8x 2026 estimated Adjusted EBITDA multiple before expected synergies. Deleveraging: Deleveraging transaction that accelerates path to sub-4.0x leverage. Under the terms of the agreement, USAC will fund $430M in cash, with plans to initially fund through available capacity under its revolving credit facility, and issue approximately 18.3 million new USAC common units to the seller. The transaction is expected to close in the first quarter of 2026, subject to customary closing conditions and regulatory approvals.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy USAC?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on USAC
Wall Street analysts forecast USAC stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for USAC is 26.75 USD with a low forecast of 25.00 USD and a high forecast of 29.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
4 Analyst Rating
0 Buy
4 Hold
0 Sell
Hold
Current: 26.150
Low
25.00
Averages
26.75
High
29.00
Current: 26.150
Low
25.00
Averages
26.75
High
29.00
About USAC
USA Compression Partners, LP is a provider of natural gas compression services. The Company provides compression services to its customers primarily in connection with infrastructure applications, including both allowing for the processing and transportation of natural gas through the domestic pipeline system and enhancing crude oil production through artificial lift processes. The Company engineers, designs, operates, services and repairs its fleet of compression units and maintains related support inventory and equipment. It also provides compression services in mature conventional basins, including gas lift applications on crude oil wells targeted by horizontal drilling techniques. It has over 3,862,102 horsepower in its fleet. It provides compression services in unconventional resource plays throughout the United States, including the Utica, Marcellus, Permian, Denver-Julesburg, Eagle Ford, Mississippi Lime, Granite Wash, Woodford, Barnett, and Haynesville shales.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Energy Transfer's Attractive Yield and Associated Risks
- Attractive Yield: Energy Transfer offers a 7.3% distribution yield, appealing to dividend investors aiming to maximize portfolio income, although the underlying business structure is somewhat complex.
- Business Complexity: As one of North America's largest midstream operators, Energy Transfer owns energy infrastructure and charges fees for usage, but also serves as the general partner for two publicly traded master limited partnerships, adding management complexity.
- Dividend History Comparison: Unlike Enterprise Products Partners, Energy Transfer cut its distribution in 2020, and while it now targets annual growth of 3% to 5%, past cuts may have disappointed income-dependent investors.
- Investment Considerations: Despite the attractive high yield, the associated risks and complexities of Energy Transfer may lead conservative dividend investors to prefer Enterprise Products Partners, which offers more stable dividend growth.
See More
Energy Transfer Plans $5.5 Billion Investment for 2026, Targeting 3%-5% Distribution Growth
- Stable Cash Flow: Energy Transfer's distributable cash flow covered its distribution by 1.8 times in the first nine months of 2025, indicating a solid income base that could attract conservative investors.
- Future Investment Plans: The company plans to invest $5.5 billion in capital projects in 2026, which is expected to support a distribution growth of 3% to 5%, demonstrating its commitment to becoming a more reliable income investment.
- Historical Trust Issues: Although the distribution has recovered and surpassed pre-pandemic levels, the cut during the 2020 pandemic still raises concerns among conservative investors, potentially affecting their investment decisions.
- Alternative Competitors: For investors wary of management decisions, alternatives like Enterprise Products Partners and Enbridge offer a more stable dividend history, albeit with slightly lower yields of 6.6% and 5.8%, respectively.
See More
Energy Transfer's Cash Flow Covers 1.8x Distribution, Positive Growth Outlook
- Cash Flow Coverage: Energy Transfer's distributable cash flow covered its distribution by 1.8 times in the first nine months of 2025, indicating strong financial health that could attract income-seeking investors.
- Capital Investment Plans: The company has $5.5 billion in capital investment projects planned for 2026, expected to support distribution growth of 3% to 5%, reflecting confidence in future revenue growth.
- Historical Issues Impact: Despite strong current cash flow, past distribution cuts in 2020 and 2016 may raise trust concerns among conservative investors, potentially affecting their investment decisions.
- Market Competition: Energy Transfer faces competition from other midstream companies like Enterprise Products Partners and Enbridge, which have demonstrated better distribution stability, potentially attracting more conservative investors.
See More
Energy Transfer (ET) Distributable Cash Flow Covers 1.8x Yield, Solid Future Growth Prospects
- Cash Flow Coverage: Energy Transfer's distributable cash flow covered its distribution by 1.8 times in the first nine months of 2025, demonstrating a reliable income source that supports its lofty 7.5% yield, thereby boosting investor confidence.
- Capital Investment Plans: The company plans to invest $5.5 billion in capital projects for 2026, which is expected to support distribution growth of 3% to 5%, indicating its commitment to becoming a more reliable income investment and enhancing long-term appeal.
- Historical Issues Impact: While the future outlook is positive, past events such as the distribution cut during the pandemic in 2020 and uncertainties surrounding the 2016 acquisition of Williams Companies may lower trust among conservative investors, affecting market performance.
- Alternative Investment Options: Given Energy Transfer's historical decisions, investors may prefer alternatives like Enterprise Products Partners and Enbridge, which have more stable records of distribution growth, even though their yields are slightly lower.
See More
USA Compression Partners (USAC) Declares $0.525 Quarterly Dividend with 8.23% Yield
- Quarterly Dividend Declaration: USA Compression Partners has declared a quarterly dividend of $0.525 per share, consistent with previous distributions, indicating the company's stable cash flow and shareholder return strategy.
- Yield Advantage: The forward yield of 8.23% not only attracts income-seeking investors but also enhances the company's appeal in the competitive energy market, positioning it favorably for future investments.
- Acquisition Expansion: The company plans to acquire compression services provider J-W Power for $860 million, which will further enhance its market share and service capabilities, expected to positively impact future revenues.
- EBITDA Target: USA Compression Partners has set a $620 million EBITDA target, aiming to optimize financial performance through expanded horsepower deployment and reduced leverage, reflecting the company's confidence in future growth.
See More
USA Compression Partners Acquires J-W Power Company for $860 Million
- Transaction Completion: USA Compression Partners has completed its acquisition of J-W Power Company for approximately $860 million, with $430 million funded in cash, reflecting the company's proactive strategy to expand its market share.
- Asset Enhancement: The acquisition adds over 800,000 active horsepower, resulting in a combined total of approximately 4.4 million active horsepower, further solidifying its leadership position in the mid-to-large horsepower compression market.
- Diversified Customer Base: The acquisition brings a diversified, high-quality customer base, enhancing USA Compression's commercial portfolio and expected to boost its competitiveness in midstream natural gas and crude oil compression services.
- Cash Flow Growth Outlook: The transaction is anticipated to deliver significant near-term accretion on a Distributable Cash Flow basis and improve the company's debt metrics, reinforcing its commitment to creating long-term value for unitholders.
See More
Energy Transfer's Attractive Yield and Associated Risks
- Attractive Yield: Energy Transfer offers a 7.3% distribution yield, appealing to dividend investors aiming to maximize portfolio income, although the underlying business structure is somewhat complex.
- Business Complexity: As one of North America's largest midstream operators, Energy Transfer owns energy infrastructure and charges fees for usage, but also serves as the general partner for two publicly traded master limited partnerships, adding management complexity.
- Dividend History Comparison: Unlike Enterprise Products Partners, Energy Transfer cut its distribution in 2020, and while it now targets annual growth of 3% to 5%, past cuts may have disappointed income-dependent investors.
- Investment Considerations: Despite the attractive high yield, the associated risks and complexities of Energy Transfer may lead conservative dividend investors to prefer Enterprise Products Partners, which offers more stable dividend growth.
See More
Energy Transfer Plans $5.5 Billion Investment for 2026, Targeting 3%-5% Distribution Growth
- Stable Cash Flow: Energy Transfer's distributable cash flow covered its distribution by 1.8 times in the first nine months of 2025, indicating a solid income base that could attract conservative investors.
- Future Investment Plans: The company plans to invest $5.5 billion in capital projects in 2026, which is expected to support a distribution growth of 3% to 5%, demonstrating its commitment to becoming a more reliable income investment.
- Historical Trust Issues: Although the distribution has recovered and surpassed pre-pandemic levels, the cut during the 2020 pandemic still raises concerns among conservative investors, potentially affecting their investment decisions.
- Alternative Competitors: For investors wary of management decisions, alternatives like Enterprise Products Partners and Enbridge offer a more stable dividend history, albeit with slightly lower yields of 6.6% and 5.8%, respectively.
See More
Energy Transfer's Cash Flow Covers 1.8x Distribution, Positive Growth Outlook
- Cash Flow Coverage: Energy Transfer's distributable cash flow covered its distribution by 1.8 times in the first nine months of 2025, indicating strong financial health that could attract income-seeking investors.
- Capital Investment Plans: The company has $5.5 billion in capital investment projects planned for 2026, expected to support distribution growth of 3% to 5%, reflecting confidence in future revenue growth.
- Historical Issues Impact: Despite strong current cash flow, past distribution cuts in 2020 and 2016 may raise trust concerns among conservative investors, potentially affecting their investment decisions.
- Market Competition: Energy Transfer faces competition from other midstream companies like Enterprise Products Partners and Enbridge, which have demonstrated better distribution stability, potentially attracting more conservative investors.
See More
Energy Transfer (ET) Distributable Cash Flow Covers 1.8x Yield, Solid Future Growth Prospects
- Cash Flow Coverage: Energy Transfer's distributable cash flow covered its distribution by 1.8 times in the first nine months of 2025, demonstrating a reliable income source that supports its lofty 7.5% yield, thereby boosting investor confidence.
- Capital Investment Plans: The company plans to invest $5.5 billion in capital projects for 2026, which is expected to support distribution growth of 3% to 5%, indicating its commitment to becoming a more reliable income investment and enhancing long-term appeal.
- Historical Issues Impact: While the future outlook is positive, past events such as the distribution cut during the pandemic in 2020 and uncertainties surrounding the 2016 acquisition of Williams Companies may lower trust among conservative investors, affecting market performance.
- Alternative Investment Options: Given Energy Transfer's historical decisions, investors may prefer alternatives like Enterprise Products Partners and Enbridge, which have more stable records of distribution growth, even though their yields are slightly lower.
See More
USA Compression Partners (USAC) Declares $0.525 Quarterly Dividend with 8.23% Yield
- Quarterly Dividend Declaration: USA Compression Partners has declared a quarterly dividend of $0.525 per share, consistent with previous distributions, indicating the company's stable cash flow and shareholder return strategy.
- Yield Advantage: The forward yield of 8.23% not only attracts income-seeking investors but also enhances the company's appeal in the competitive energy market, positioning it favorably for future investments.
- Acquisition Expansion: The company plans to acquire compression services provider J-W Power for $860 million, which will further enhance its market share and service capabilities, expected to positively impact future revenues.
- EBITDA Target: USA Compression Partners has set a $620 million EBITDA target, aiming to optimize financial performance through expanded horsepower deployment and reduced leverage, reflecting the company's confidence in future growth.
See More
USA Compression Partners Acquires J-W Power Company for $860 Million
- Transaction Completion: USA Compression Partners has completed its acquisition of J-W Power Company for approximately $860 million, with $430 million funded in cash, reflecting the company's proactive strategy to expand its market share.
- Asset Enhancement: The acquisition adds over 800,000 active horsepower, resulting in a combined total of approximately 4.4 million active horsepower, further solidifying its leadership position in the mid-to-large horsepower compression market.
- Diversified Customer Base: The acquisition brings a diversified, high-quality customer base, enhancing USA Compression's commercial portfolio and expected to boost its competitiveness in midstream natural gas and crude oil compression services.
- Cash Flow Growth Outlook: The transaction is anticipated to deliver significant near-term accretion on a Distributable Cash Flow basis and improve the company's debt metrics, reinforcing its commitment to creating long-term value for unitholders.
See More
