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1. Company Snapshot

1.a. Company Description

Hess Corporation, an exploration and production company, explores, develops, produces, purchases, transports, and sells crude oil, natural gas liquids (NGLs), and natural gas.The company operates in two segments, Exploration and Production, and Midstream.It conducts production operations primarily in the United States, Guyana, the Malaysia/Thailand Joint Development Area, and Malaysia; and exploration activities principally offshore Guyana, the U.S. Gulf of Mexico, and offshore Suriname and Canada.


The company is also involved in gathering, compressing, and processing natural gas; fractionating NGLs; gathering, terminaling, loading, and transporting crude oil and NGL through rail car; and 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.As of December 31, 2021, it had total proved reserves of 1,309 million barrels of oil equivalent.The company was incorporated in 1920 and is headquartered in New York, New York.

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1.b. Last Insights on HES

Here is a 90-word analysis of the positive drivers behind Hess Corporation's recent stock performance: Hess Corporation's strong Q4 earnings, beating estimates, were driven by increased oil-equivalent production and lower costs, despite weaker realized crude and natural gas prices. The company's adjusted EPS of $1.76 surpassed forecasts, with revenue and non-operating income reaching $3.23 billion, exceeding expectations. Additionally, Hess Midstream LP's solid quarterly results, with revenue up 11% and EBITDA margins expanding to 81%, supported the bullish outlook. Guidance for 2025 and beyond is robust, with expected EBITDA growth and potential for significant buybacks.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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Hess Midstream: High-Yield Undervalued Midstream Play With Long-Term Gas Potential

Nov -21

Source: seekingalpha.com

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Barrow, Hanley, Mewhinney & Strauss Makes Significant Moves with Berkshire Hathaway Inc.

Nov -13

Source: gurufocus.com

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PRIMECAP Management's Strategic Moves: Hess Corp Exit and Chevron Corp Addition

Nov -12

Source: gurufocus.com

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Chevron investor day puts spotlight on post-Hess strategy

Nov -10

Source: reuters.com

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Hess Midstream LP Reports Estimated Results for the Third Quarter of 2025

Nov -03

Source: businesswire.com

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Chevron earnings beat Wall Street estimates as oil production hits record boosted by Hess acquisition

Oct -31

Source: cnbc.com

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Chevron tops Q3 earnings estimates with record production after Hess deal

Oct -31

Source: reuters.com

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Hess Midstream LP Schedules Earnings Release Conference Call

Oct -20

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.63%)

6. Segments

Exploration and Production

Expected Growth: 8.5%

Hess Corporation's Exploration and Production segment growth of 8.5% is driven by increased production from its Guyana and Bakken assets, higher oil prices, and successful exploration activities. Improved operational efficiency and cost management also contributed to the growth, enabling the company to capitalize on favorable market conditions and deliver strong performance.

Midstream

Expected Growth: 7.2%

Hess Corporation's Midstream segment growth of 7.2% is driven by increased volumes from the Bakken and Permian basins, higher rates from the Stampede and Neptune platforms, and the successful execution of the company's strategic plan, resulting in improved operational efficiency and capacity utilization.

Eliminations

Expected Growth: 6.0%

Hess Corporation's growth of 6.0% is driven by increased oil and gas production, higher selling prices, and cost reductions. The company's strategic focus on offshore assets, particularly in Guyana and the Bakken, has contributed to the growth. Additionally, Hess's emphasis on operational efficiency and reduced capital expenditures has improved profitability, driving the company's growth.

7. Detailed Products

Crude Oil

Hess Corporation is a leading explorer and producer of crude oil, with operations in the United States, Denmark, Equatorial Guinea, and Malaysia.

Natural Gas

Hess Corporation is a significant producer of natural gas, with operations in the United States, Denmark, and Malaysia.

Natural Gas Liquids (NGLs)

Hess Corporation produces NGLs, including propane, butane, and ethane, as a byproduct of natural gas production.

Refined Petroleum Products

Hess Corporation markets and sells refined petroleum products, including gasoline, diesel fuel, jet fuel, and lubricants.

Midstream Services

Hess Corporation provides midstream services, including crude oil and natural gas gathering, processing, and transportation.

8. Hess Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Hess Corporation operates in the energy sector, which has limited substitutes. However, the increasing adoption of renewable energy sources and energy-efficient technologies poses a moderate threat to the company's operations.

Bargaining Power Of Customers

Hess Corporation's customers, primarily oil and gas companies, have limited bargaining power due to the company's diversified operations and strong market position.

Bargaining Power Of Suppliers

Hess Corporation relies on various suppliers for its operations, including equipment and service providers. While suppliers have some bargaining power, the company's scale and diversification mitigate this risk.

Threat Of New Entrants

The energy sector has high barriers to entry, including significant capital requirements and regulatory hurdles, making it difficult for new entrants to compete with established players like Hess Corporation.

Intensity Of Rivalry

The energy sector is highly competitive, with numerous players vying for market share. Hess Corporation faces intense rivalry from other major oil and gas companies, which can impact its market share and pricing power.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 49.99%
Debt Cost 7.82%
Equity Weight 50.01%
Equity Cost 10.21%
WACC 9.02%
Leverage 99.97%

11. Quality Control: Hess Corporation passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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A-Score: 5.7/10

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

148.97$

Current Price

148.97$

Potential

-0.00%

Expected Cash-Flows