NEW YORK (TheStreet) -- Hess (HES) - Get Report stock is retreating by 4.43% to $56.11 in midday trading on Tuesday, ahead of the company's financial results for the 2015 third quarter, which are due out before the market open on Wednesday.
Analysts have forecast that the company will post a year over year decline in both earnings per share and revenue.
Analysts surveyed by Thomson Reuters expect Hess to report a loss of $1.19 per share on revenue of $1.62 billion.
Last year, the company reported earnings of $1.24 per share on revenue of 2.8 billion for the 2014 third quarter.
Based in New York City, Hess develops, produces, purchases, transports and sells crude oil and natural gas.
Separately, TheStreet Ratings team rates HESS CORP as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
We rate HESS CORP (HES) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- HES's debt-to-equity ratio is very low at 0.28 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.78 is somewhat weak and could be cause for future problems.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 34.1%. Since the same quarter one year prior, revenues fell by 31.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The gross profit margin for HESS CORP is rather high; currently it is at 53.71%. Regardless of HES's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, HES's net profit margin of -29.03% significantly underperformed when compared to the industry average.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, HESS CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has decreased to $714.00 million or 21.62% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, HESS CORP has marginally lower results.
- You can view the full analysis from the report here: HES