Morningstar

The Hershey Co HSY

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Stock XNYS Rating as of
$181.66 +0.82 (0.45%)
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Macro and Competitive Angst Fail to Dent Cravings for Hershey's Leading Confectionery Mix

Erin Lash

After eight years at the helm, CEO Michele Buck has passed the torch to Kirk Tanner (the former CEO of Wendy's). We applaud the strategic focus Buck brought to bear--ramping up investments in Hershey's core domestic brands while pulling back in its international arm (high-single-digit percentage of total sales, where we surmise its competitive position has perpetually lagged global peers).

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Price vs Fair Value

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HSY is trading at a 477% premium.
Price
$181.66
Fair Value
$381.00
Uncertainty
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1-Star Price
$762.80
5-Star Price
$434.70
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Hershey has intentionally rationalized its fare over the past few years to ensure that shelf space and advertising dollars are allocated to the highest-return opportunities.

Bears

Unrelenting pressure on consumer pocketbooks could dent purchases of more indulgent and discretionary categories, such as confectionery and snacking.

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Trading Information

Previous Close Price
$180.84
Day Range
$180.91–183.70
52-Week Range
$160.07–239.48
Bid/Ask
$177.06 / $185.00
Shares Outstanding
202.84M
Market Cap
$36.85B
Volume/Avg
1M / 2M

Key Statistics

Price/Earnings (Normalized)
27.53
Price/Sales
3.07
Dividend Yield (Trailing)
3.21%
Dividend Yield (Forward)
3.30%
Total Yield
3.29%

Company Profile

Hershey is a leading US confectionery manufacturer (around a $55 billion market, according to Euromonitor), controlling 35% of the domestic chocolate aisle. Beyond its namesake label, the firm's portfolio has expanded over the last 85 years and now comprises 100 brands, including Reese's, Kit Kat, Kisses, and Ice Breakers. Hershey's products are sold in about 80 countries, albeit with just a high-single-digit percentage of sales coming from markets outside the US, including Brazil, India, and Mexico. The firm has sought inorganic opportunities to extend its reach beyond its core confectionery business, adding Amplify Snack Brands and its Skinny Pop ready-to-eat popcorn to its portfolio, as well as Pirate Brands, Dot's Pretzels, and LesserEvil over the past few years.
Sector
Consumer Defensive
Industry
Confectioners
Stock Style Box
Mid Core
Total Number of Employees
19,595
Website
https://www.thehersheycompany.com

Competitors

Valuation

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Metric
HSY
CPB
MDLZ
Price/Earnings (Normalized)
 27.539.5022.39
Price/Book Value
 7.751.693.16
Price/Sales
 3.070.692.08
Price/Cash Flow
 15.815.3015.59
Price/Earnings
HSY
CPB
MDLZ

Financial Strength

Metric
HSY
CPB
MDLZ
Quick Ratio
 0.610.320.29
Current Ratio
 1.240.870.54
Interest Coverage
 7.333.375.64
Quick Ratio
HSY
CPB
MDLZ

Profitability

Metric
HSY
CPB
MDLZ
Return on Assets (Normalized)
 10.47%4.43%5.20%
Return on Equity (Normalized)
 31.12%16.92%14.19%
Return on Invested Capital (Normalized)
 15.06%8.36%8.07%
Return on Assets
HSY
CPB
MDLZ

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