UPDATE: Societe Generale Downgrades Hess Corporation to Hold, Raises PT on Bakken Overcapitalization Concerns

In a report published Tuesday, Societe Generale analyst John Herrlin downgraded the rating on Hess Corporation HES from Buy to Hold, but raised the price target from $80.00 to $86.00. In the report, Societe Generale noted, “As part of our 3Q E&P sector preview note published today, we downgrade HES to Hold based on our concerns that HES's restructuring process could be more protracted than the Street expects, that the Street might be ascribing higher asset sale values than realised, and that the potential exists for HES to over-capitalize their unconventional Bakken developments. These three items worry us when the stock is up 50% year-to-date and is nearing its five-year high. That said, we are increasing our price target to $86 (up from $80) on the continued improvements in Bakken development, HES's portfolio reshuffling, and our revised 2013/2014 estimates, but that's not enough to justify a Buy rating requiring +15% TSR over a 12-month timeframe.” Hess Corporation closed on Monday at $77.34.