Hess Earnings: Guyana and Bakken Continue to Drive Volumes Higher

Narrow-moat Hess reported a solid first quarter, with net income nearly tripling over the prior year, $972 million versus $346 million, driven by the volume increases primarily in Guyana and, to a lesser extent, the Bakken. With debottlenecking and additional stages waiting in the wings, we see volumes increasing to more than 550 thousand barrels of oil equivalent a day (mboe/d) in 2025 from the 474 mboe/d just reported. With no change in our fair value estimate of Chevron, we see the shares as somewhat undervalued at $180. The difference in our view and the market is likely down to the perceived risk in the acquisition closing as it is still under challenge by ExxonMobil regarding the Guyana assets.