Hess Corporation Faces Market Challenges Amid Mixed Earnings Outlook

Hess Corporation (HES), with a market capitalization of $40.9 billion, is a leading energy company based in New York. It primarily focuses on exploring and producing oil and gas in the U.S. Gulf of Mexico, offshore Guyana, and other significant global markets.

In the past year, Hess’s stock has lagged behind the broader market, dropping 18.9%, while the S&P 500 Index ($SPX) saw a rise of 10.2%. As of 2025, HES recorded a slight decline of 3.2%, contrasted with a 3.9% year-to-date fall in the S&P 500.

Furthermore, Hess underperformed compared to the Energy Select Sector SPDR Fund (XLE), which gained 13% in the last year, although HES outshone the ETF’s 6% decline in 2025.

On April 30, Hess’s stock fell 2.6% following the announcement of its Q1 2025 financial results. Despite exceeding revenue forecasts with $2.94 billion—down 12% from last year—adjusted earnings remained robust at $559 million ($1.81 per share), beating analyst expectations. The company’s production was steady at 476,000 boepd, showing growth in the Bakken shale, though output from Guyana declined. For Q2 2025, Hess anticipates stable production levels, with upcoming developments in Guyana expected to enhance future output.

For the current fiscal year ending December 2025, analysts project a significant decline in EPS, expecting it to drop 35.2% year-over-year to $6.27. However, Hess has a favorable history of earnings surprises, having surpassed consensus estimates in the last four quarters.

The consensus rating for Hess Corporation is cautiously optimistic, with an overall “Moderate Buy” recommendation. Among 16 analysts, there are six “Strong Buys” and ten “Holds.”

On April 22, Susquehanna Community Financial, Inc. (SQCF) lowered its price target on Hess from $160 to $136, while maintaining a “Positive” rating. This decision followed a downward revision in oil price forecasts, now expecting $68 per barrel in 2025 and $67 long-term. Factors influencing this shift include weaker global demand stemming from tariffs, rising recession concerns, and OPEC+ plans to gradually unwind its 2.2 million barrels per day in voluntary production cuts, adding more supply to the market.

The average price target is $161.37, indicating a potential upside of 25.3% from the current share price. The highest target of $199 suggests a premium of 54.5% from present levels.

On the date of publication, Kritika Sarmah held no positions in any of the securities mentioned in this article. All information in this article is intended for informational purposes only. For further details, please refer to the Barchart Disclosure Policy here.

The views expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.