We recently published a list of Top 10 Stocks to Buy According to Adage Capital Management. In this article, we are going to take a look at where Hess Corporation (NYSE:HES) stands against other top stocks to buy according to Adage Capital Management.
Adage Capital Management, based in Boston, is a major investment firm specializing in managing the broader market’s assets, with a strong focus on Endowments and Foundations. Among its prominent clients are institutions such as Harvard University, Dartmouth College, Northwestern University, the American Red Cross, and the Getty Foundation. Over the last 15 years, Adage and its predecessor, the Select Equity Group at Harvard Management Company, have consistently surpassed the wider market’s performance by an average of 3.5%.
The firm’s origins date back to the mid-1980s when co-founders Phillip Gross and Robert Atchinson met as investment analysts for Harvard’s endowment. In the 1990s, following controversy over large performance bonuses at Harvard Management, they, along with an 18-person team, left to establish Adage Capital Management. Their launch was backed by a $1.8 billion initial investment from Harvard, with an agreement that the university would receive 10% of Adage’s earnings.
Adage Capital Management primarily manages the broader market’s assets for endowments and foundations, utilizing a long/short equity strategy driven by fundamental analysis. The firm also explores risk arbitrage and event-driven investment opportunities when suitable.
Phillip Gross, more commonly known as Phill Gross, co-founded Adage Capital Management, L.P. in 2001 and serves as a Managing Director and Healthcare Portfolio Manager. Before establishing the firm, he spent 18 years at Harvard Management Company, Inc., where he held roles as a Healthcare and Retail Analyst, Equity Research Director, and Partner.
Gross earned both his B.S. in finance and economics in 1982 and M.S. in investments in 1983 from the University of Wisconsin. He previously served on the UW Foundation Board of Directors and is currently involved with the Steve Hawk Center for Applied Securities Analysis Advisory Board and the Nicholas Center for Applied Corporate Finance Advisory Board. In 2006, he was honored with the Distinguished Alumnus Award from the UW Business School.
In philanthropy, Gross co-founded Strategic Grant Partners, an initiative aimed at systemic change in education and family services in Massachusetts. He serves as Vice President of the Board of Directors for Youth Enrichment Services, a Boston-based organization that introduces urban youth to outdoor activities. Additionally, he is a Board Trustee of the U.S. Ski and Snowboard Association, vice-chair of its Investment Committee, and a board member of the T2 Foundation.
Adage Capital Management’s Q4 2024 13F filing reported $57.19 billion in managed 13F securities, with its top 10 holdings accounting for 31.7% of the total portfolio. This distribution highlights the firm’s diversified investment approach.
Our Methodology
The stocks discussed below were picked from Adage Capital Management’s Q4 2024 13F filings. They are compiled in the ascending order of the hedge fund’s stake in them as of December 31, 2024. To assist readers with more context, we have included the hedge fund sentiment regarding each stock using data from over 1,000 hedge funds tracked by Insider Monkey in the fourth quarter of 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
An oil tanker sailing across the horizon, conveying the importance of crude oil transportation for the company.
Hess Corporation (NYSE:HES)
Number of Hedge Fund Holders as of Q4: 92
Adage Capital Management’s Equity Stake: $1.52 Billion
Hess Corporation (NYSE:HES), an American independent energy company founded in 1933, specializes in the exploration and production of crude oil and natural gas. The company operates production facilities across key regions, including the United States, Guyana, and Malaysia, while also focusing on offshore exploration in areas like the Gulf of Mexico and Suriname.
Hess Corporation (NYSE:HES) delivered impressive Q4 2024 earnings, reporting $1.76 per share, surpassing the consensus estimate of $1.51 and improving from $1.63 per share in the previous year. The company’s net income surged to $542 million, compared to $413 million in Q4 2023, marking its fourth consecutive quarter outperforming earnings expectations. This consistent earnings beat highlights Hess’s strong financial performance and operational efficiency in the oil and gas sector, reinforcing its ability to navigate market fluctuations effectively.
In addition to earnings growth, Hess Corporation (NYSE:HES) reported revenue of $3.23 billion for Q4 2024, exceeding analyst expectations by 6.38% and growing from $3.04 billion year-over-year. The company’s stock has gained approximately 8.87% since the beginning of the year, significantly outperforming the broader market’s 1.68% decline. With a strong track record of revenue expansion and effective capital management, Hess is well-positioned for continued momentum in the near term, though future performance will depend on market conditions and management’s strategic outlook.
On March 5, 2025, Hess Corporation’s Board of Directors declared a regular quarterly dividend of $0.50 per share, payable on March 31, 2025, to shareholders of record as of March 17, 2025. With a market capitalization of $45.7 billion, Hess Corporation (NYSE:HES) remains a key player in oil exploration and production across the U.S. and Gulf of Mexico. As of March 12, 2025, analysts maintain the consensus rating of “Moderate Buy” on HES, with a mean price target of $167.47, representing a potential 15.8% upside from current levels.
Overall, HES ranks 5th on our list of top stocks to buy according to Adage Capital Management. While we acknowledge the potential for HES as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than HES but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.