Is the Rally over for Hess?
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Jun
18
Jonathan Yates
Is the Rally over for Hess?
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Hess Corporation (NYSE: HES) is an oil and gas company that focuses on the refining and marketing segments.

Pressure from institutional investors has the stock price of Hess Corporation up almost 60% for the last year.  For 2013, Hess is up more than 27%.  But as the chart below shows, Hess Corporation has been falling in recent market action.

Hess is down for the last week, month and quarter of market action.  Obviously, the overall market conditions contribute to that.  But there is much on hte income statement and balance sheet to cause concerns for investors.

The price-to-cash ratio for Hess Corporation is over 50, which is very high.  Earnings-per-share growth is very weak.  It is projected to fall next year after being just 0.50% for the last five years.

The dividend is very low at just 0.59%.  While the payout ratio is low, there is not much cash to increase it.  There is only about $1.30 in cash per share.

Now trading around $67.30, the mean analyst target price for Hess Corporation over the next year of market action is $79.78.  As the stock is now trading beneath its 20-day and 50-day moving averages, it is difficult to see it making that jump of about 15% after the huge increase already for 2013.

However, the most recent analyst action for Hess Corporation was an upgrade by Barclay’s on April 22, 2013, lifting the target price to $86 a share.  Over the last quarter, however, Hess Corporation is down by 6.38%.

 



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