NYSE:HES

Stock Analysis Report

Executive Summary

Hess Corporation, an exploration and production company, explores, develops, produces, purchases, transports, and sells crude oil, natural gas liquids (NGLs), and natural gas.


Snowflake Analysis

Mediocre balance sheet with moderate growth potential.


Similar Companies

Share Price & News

How has Hess's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HES's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

17.7%

HES

17.5%

US Oil and Gas

12.5%

US Market


1 Year Return

-44.1%

HES

-57.2%

US Oil and Gas

-12.7%

US Market

Return vs Industry: HES exceeded the US Oil and Gas industry which returned -57.2% over the past year.

Return vs Market: HES underperformed the US Market which returned -12.7% over the past year.


Shareholder returns

HESIndustryMarket
7 Day17.7%17.5%12.5%
30 Day-39.4%-36.4%-14.7%
90 Day-49.1%-52.2%-21.5%
1 Year-42.9%-44.1%-55.5%-57.2%-10.9%-12.7%
3 Year-23.1%-27.5%-52.3%-56.9%12.6%5.4%
5 Year-48.3%-53.1%-55.6%-62.5%31.9%17.5%

Price Volatility Vs. Market

How volatile is Hess's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Hess undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: HES ($34.03) is trading below our estimate of fair value ($84.73)

Significantly Below Fair Value: HES is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: HES is unprofitable, so we can't compare its PE Ratio to the Oil and Gas industry average.

PE vs Market: HES is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate HES's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: HES is overvalued based on its PB Ratio (1.2x) compared to the US Oil and Gas industry average (0.5x).


Next Steps

Future Growth

How is Hess forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

48.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HES is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.7%).

Earnings vs Market: HES is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: HES's is expected to become profitable in the next 3 years.

Revenue vs Market: HES's revenue (2.9% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: HES's revenue (2.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HES's Return on Equity is forecast to be low in 3 years time (0.4%).


Next Steps

Past Performance

How has Hess performed over the past 5 years?

-0.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HES is currently unprofitable.

Growing Profit Margin: HES is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: HES is unprofitable, and losses have increased over the past 5 years at a rate of -0.7% per year.

Accelerating Growth: Unable to compare HES's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: HES is unprofitable, making it difficult to compare its past year earnings growth to the Oil and Gas industry (-11.4%).


Return on Equity

High ROE: HES has a negative Return on Equity (-2.47%), as it is currently unprofitable.


Next Steps

Financial Health

How is Hess's financial position?


Financial Position Analysis

Short Term Liabilities: HES's short term assets ($3.2B) exceed its short term liabilities ($2.5B).

Long Term Liabilities: HES's short term assets ($3.2B) do not cover its long term liabilities ($9.6B).


Debt to Equity History and Analysis

Debt Level: HES's debt to equity ratio (73.6%) is considered high.

Reducing Debt: HES's debt to equity ratio has increased from 26.2% to 73.6% over the past 5 years.


Balance Sheet

Inventory Level: HES has a high level of physical assets or inventory.

Debt Coverage by Assets: HES's debt is not covered by short term assets (assets are 0.4x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: HES has sufficient cash runway for more than a year based on its current free cash flow.

Forecast Cash Runway: HES has sufficient cash runway for 2.6 years if free cash flow continues to grow at historical rates of 8% each year.


Next Steps

Dividend

What is Hess's current dividend yield, its reliability and sustainability?

2.94%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: HES's dividend (2.94%) is higher than the bottom 25% of dividend payers in the US market (1.98%).

High Dividend: HES's dividend (2.94%) is low compared to the top 25% of dividend payers in the US market (5.49%).


Stability and Growth of Payments

Stable Dividend: HES's dividends per share have been stable in the past 10 years.

Growing Dividend: HES's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: HES is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: HES's dividends in 3 years are not forecast to be well covered by earnings (363.1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.8yrs

Average management tenure


CEO

John Hess (65yo)

24.83s

Tenure

US$12,572,440

Compensation

Mr. John B. Hess has been the Chief Executive Officer at Hess Corporation since May 3, 1995. Mr. Hess has been the Chairman of the Board of Directors and Chief Executive Officer of Hess Midstream GP LLC, t ...


CEO Compensation Analysis

Compensation vs Market: John's total compensation ($USD12.57M) is about average for companies of similar size in the US market ($USD11.74M).

Compensation vs Earnings: John's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
John Hess
CEO & Director24.83yrsUS$12.57m8.82% $915.6m
Gregory Hill
President & COOno dataUS$8.72m0.042% $4.4m
John Rielly
Senior VP & CFO15.92yrsUS$3.98m0.082% $8.6m
Timothy Goodell
Senior VP1.17yrsUS$4.13m0.045% $4.7m
Michael Turner
Senior Vice President10.75yrsUS$3.15m0.025% $2.6m
Richard Lynch
Senior Vice President of Technology & Services2.17yrsno data0.013% $1.3m
Jay Wilson
Vice President of Investor Relations16.67yrsno datano data
Lorrie Hecker
VP of Communications2.58yrsno datano data
Andrew Slentz
Senior VP of Human Resources & Office Management3.83yrsno data0.014% $1.4m
Jonathan Stein
VP, CFO of Midstream & Chief Risk Officer3.17yrsno datano data

3.8yrs

Average Tenure

61yo

Average Age

Experienced Management: HES's management team is considered experienced (3.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
John Hess
CEO & Director24.83yrsUS$12.57m8.82% $915.6m
Rodney Chase
Independent Director6.83yrsUS$339.79k0.019% $1.9m
Edith Holiday
Independent Director27.17yrsUS$305.15k0.019% $1.9m
Risa Lavizzo-Mourey
Independent Director15.75yrsUS$305.15k0.015% $1.5m
Leonard Coleman
Independent Director3.5yrsUS$300.66k0.0048% $500.6k
Kevin Meyers
Independent Director6.83yrsUS$342.96k0.0099% $1.0m
David McManus
Independent Director6.83yrsUS$300.15k0.011% $1.1m
Terrence Checki
Independent Director5.83yrsUS$305.15k0.0070% $722.9k
William Schrader
Independent Director6.83yrsUS$316.17k0.0084% $874.5k
James Quigley
Independent Chairman4yrsUS$507.96k0.0081% $839.2k

6.8yrs

Average Tenure

66.5yo

Average Age

Experienced Board: HES's board of directors are considered experienced (6.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: HES insiders have sold more shares than they have bought in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Hess Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Hess Corporation
  • Ticker: HES
  • Exchange: NYSE
  • Founded: 1920
  • Industry: Oil and Gas Exploration and Production
  • Sector: Energy
  • Market Cap: US$10.386b
  • Shares outstanding: 305.21m
  • Website: https://www.hess.com

Number of Employees


Location

  • Hess Corporation
  • 1185 Avenue of the Americas
  • 40th Floor
  • New York
  • New York
  • 10036
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HESNYSE (New York Stock Exchange)YesCommon StockUSUSDMar 1964
AHCDB (Deutsche Boerse AG)YesCommon StockDEEURMar 1964
AHCXTRA (XETRA Trading Platform)YesCommon StockDEEURMar 1964
0J50LSE (London Stock Exchange)YesCommon StockGBUSDMar 1964
AHCBRSE (Berne Stock Exchange)YesCommon StockCHCHFMar 1964
AHCETLX (Eurotlx)YesCommon StockITEURMar 1964
H1ES34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 SHS UNSPONBRBRLJan 2020

Biography

Hess Corporation, an exploration and production company, explores, develops, produces, purchases, transports, and sells crude oil, natural gas liquids (NGLs), and natural gas. It operates through two segments, Exploration and Production, and Midstream. The company conducts production operations primarily in the United States, Denmark, the Malaysia/Thailand Joint Development Area, and Malaysia; and exploration activities primarily offshore Guyana, Suriname, Canada, and in the Gulf of Mexico. As of December 31, 2019, it had total proved reserves of 1,197 million barrels of oil equivalent. The company is also involved in the gathering, compressing, and processing of natural gas; fractionating NGLs; terminaling, loading, and transporting crude oil and NGLs through rail car; storing and terminaling propane, as well as providing water handling services primarily in the Bakken Shale plays in the Williston Basin area of North Dakota. The company was founded in 1920 and is headquartered in New York, New York. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/30 03:08
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.