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Hess Shares Up on 3Q Profit, Oil's Climb
Shares of Hess Corp. climbed Wednesday after the integrated oil company said its quarterly earnings rose 33 percent.
The increase came amid a broader rally of oil stocks, which rose along with the price of crude futures after the U.S. government reported a bigger-than-expected drop in oil inventories.
Light, sweet crude for December delivery rose $3.04 to $93.42 a barrel on the New York Mercantile Exchange after rising as high as $94, a new trading record.
Earlier in the day, Hess (nyse: HES - news - people ) said third-quarter profit rose to $395 million, or $1.23 per share, from $296 million, or 94 cents per share, during the same period last year.
Hess's profit fell short of analysts' average estimate of $1.36 per share, according to a Thomson Financial survey, but it included $33 million in charges. Thomson estimates typically exclude one-time charges.
Analysts said the adjusted results were generally in-line with expectations, and welcomed the company's surprisingly strong exploration and production results.
"We think Hess shares will benefit from our bullish and above-consensus view of crude oil, especially in light of its much healthier (exploration and production) business relative to years past," Goldman Sachs (nyse: GS - news - people ) analyst Arjun N. Murti wrote in a note to investors. He rates the stock "Buy" with a target price of $78, although he said he expects the stock could move even higher.
"Our target price does not give credit for future exploration success, which could have a meaningful impact on Hess's valuation," he said.
Hess shares rose $2.85, or 4.1 percent, to close at $71.61 Wednesday. Earlier in the session, the stock hit $72.60, 10 cents short of its 12-month high. Hess shares have traded as low as $40.35 in the past year.
http://www.forbes.com/feeds/ap/2007/10/31/ap4286961.html
Shares of Hess Corp. climbed Wednesday after the integrated oil company said its quarterly earnings rose 33 percent.
The increase came amid a broader rally of oil stocks, which rose along with the price of crude futures after the U.S. government reported a bigger-than-expected drop in oil inventories.
Light, sweet crude for December delivery rose $3.04 to $93.42 a barrel on the New York Mercantile Exchange after rising as high as $94, a new trading record.
Earlier in the day, Hess (nyse: HES - news - people ) said third-quarter profit rose to $395 million, or $1.23 per share, from $296 million, or 94 cents per share, during the same period last year.
Hess's profit fell short of analysts' average estimate of $1.36 per share, according to a Thomson Financial survey, but it included $33 million in charges. Thomson estimates typically exclude one-time charges.
Analysts said the adjusted results were generally in-line with expectations, and welcomed the company's surprisingly strong exploration and production results.
"We think Hess shares will benefit from our bullish and above-consensus view of crude oil, especially in light of its much healthier (exploration and production) business relative to years past," Goldman Sachs (nyse: GS - news - people ) analyst Arjun N. Murti wrote in a note to investors. He rates the stock "Buy" with a target price of $78, although he said he expects the stock could move even higher.
"Our target price does not give credit for future exploration success, which could have a meaningful impact on Hess's valuation," he said.
Hess shares rose $2.85, or 4.1 percent, to close at $71.61 Wednesday. Earlier in the session, the stock hit $72.60, 10 cents short of its 12-month high. Hess shares have traded as low as $40.35 in the past year.
http://www.forbes.com/feeds/ap/2007/10/31/ap4286961.html
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