Hess stock price forecast adjustments in July 2024 account for

Hess stock price forecast adjustments in July 2024 account for recent crude rally sparked by OPEC+ production cuts. Valuation models price shares at 13x forward EPS, higher than recent sector averages. We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. For Q1 2025, Hess Corporation anticipates net production to average between 465,000 and 475,000 boepd due to planned maintenance activities in Guyana and potential winter weather impacts in the Bakken region.