Hess' FCF Growth & Resource Potential Trigger 9% Price Target Boost By This Analyst
Raymond James analyst John Freeman reiterated an Outperform rating on the shares of Hess Corp (NYSE: HES) and raised the price target from $160 to $175.
The analyst said Hess offers leading Free Cash Flow (FCF) growth in the industry, with FCF anticipated to grow 6x from 2023 to 2030 at strip pricing, thanks in large part to the incredible resource in Guyana.
Payara will be the next inflection point, playing a large role in the more than 2x growth in FCF from 2023 to 2024.
Payara development is still on track for first production by year-end 2023 and Yellowtail, the fourth development, is on track first production in 2025, cited the analyst.
These two projects will bring in 150Mbo/d net to Hess, plus an additional 30 mboe/d out of the Bakken by YE24, added the analyst.
In the next three years, Hess is looking to increase its production by more than 50%, assuming Guyana and Bakken production plans come to fruition, said the analyst.
The analyst said the $175 target price is based on a discounted cash flow model.
The analyst added that Hess remains a differentiated story with Guyana and the long-term visibility from that tremendous resource.
Price Action: HES shares are trading higher by 0.61% at $155.75 on the last check Monday.
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Latest Ratings for HES
Date | Firm | Action | From | To |
|---|---|---|---|---|
Mar 2022 | Wells Fargo | Maintains | Overweight | |
Jan 2022 | Credit Suisse | Maintains | Neutral | |
Jan 2022 | Morgan Stanley | Maintains | Overweight |
View More Analyst Ratings for HES
View the Latest Analyst Ratings
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