Plains GP Holdings (PAGP) generated a 49% free cash flow yield over the past twelve months, as highlighted in a report published on September 30, 2025. This metric indicates the company's strong underlying cash generation capabilities relative to its market capitalization.
The company's business model, which involves acquiring stakes in midstream oil and gas infrastructure like pipelines and storage systems, results in significant non-cash expenses. These expenses primarily include depreciation and amortization, which reduce reported net income but not actual cash flow.
These non-cash adjustments convert a net income of -$206 million to a substantial free cash flow of $2.1 billion. This demonstrates that despite reporting a negative net income, Plains GP maintains the financial capacity to invest and manage its operations effectively, supporting its strategic objectives.
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