| Citi Upgrades Hess Corp After Bakken Midstream JV Reveal | |
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In a report published Friday, Citi analyst Robert S Morris upgraded the rating on Hess Corp. (NYSE: HES) from Neutral to Buy, while raising the price target from $80 to $88. The company has entered into a joint venture to monetize its Bakken midstream holdings.
Hess announced that it will sell a 50 percent interest in its Bakken Midstream Assets to privately-held firm, Global Infrastructure Partners. However, Hess will retain operational control of these assets.
"Following the closing of this transaction in early Q3'15, mgmt. stated it expects to proceed with an IPO of this JV – Hess Infrastructure Partners (HIP) – although it did not indicate how many of the then-held HIP units it plans to sell as part of the IPO," Morris reported.
The company also announced it expected to achieve gross EBITDA of $290-300 million from the Bakken Midstream Assets during the 12 months to March 31, 2016. Hess also expects the joint venture to lead to decline in its annual E&P net margin, while EV is expected to rise, driven by the cash proceeds from the transaction and the subsequent increase in working capital.
"Subsequent to this transaction, and before any possible proceeds from an IPO of HIP, we project that Hess will end the year with a well-below peer average net debt-to-capitalization ratio," the Citi report stated, while adding, "Apart from continuing to assess potential acquisition opportunities, Hess will have even more ‘dry powder' to continue, or accelerate, its share repurchase program."
Latest Ratings for HES
Date | Firm | Action | From | To |
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Jun 2015 | Citigroup | Upgrades | Hold | Buy | Jun 2015 | Credit Suisse | Maintains | | Neutral | Jun 2015 | Capital One Financial | Upgrades | Hold | Overweight |
View More Analyst Ratings for HES
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Hess Corporation
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CODE : HES |
ISIN : US42809H1077 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Hess Corp. is a and oil exploration company based in United states of america. Hess Corp. is listed in Germany and in United States of America. Its market capitalisation is US$ 48.1 billions as of today (€ 42.1 billions). Its stock quote reached its lowest recent point on November 17, 1989 at US$ 10.06, and its highest recent level on March 28, 2024 at US$ 152.64. Hess Corp. has 315 053 615 shares outstanding. |