The Hershey Company (HSY) AI Stock Analysis

• Market Cap: $31.47B
• Dividend Yield: 3.53%
• Average Volume (3M): 1.60M
• Price to Earnings (P/E): 19.2
• Beta (1Y): 0.07
• Revenue Growth: -5.91%
• EPS Growth: -19.78%
• Country: US
• Employees: 18,540
• Sector: Consumer Defensive
• Sector Strength: 76
• Industry: Food Confectioners
• EPS (TTM): 2.09
• Shares Outstanding: 147,990,280
• 10 Day Avg. Volume: 1,930,481
• 30 Day Avg. Volume: 1,603,112
• PEG Ratio: -0.83
• Price to Book (P/B): 7.40
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 19.01
• Enterprise Value/Market Cap: 1.25
• Enterprise Value/Revenue: 0.90
• Enterprise Value/Gross Profit: 8.54
• Enterprise Value/Ebitda: 3.41
• 1Y Price Target: $161.00
• Price Target Upside: 3.64% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 14

• Rating: 77 Outperform
• Price Target: $190.00 ▲( 22.30% Upside)

Hershey's overall score reflects a robust financial position and balanced valuation, tempered by challenges highlighted in the earnings call. Strong profitability and a sound balance sheet underpin the company's strengths, while cautious guidance due to external cost pressures presents significant risks. Technical analysis suggests stability but lacks clear upward momentum.

Positive Factors

Earnings

The Hershey Company's first quarter exceeded expectations due to better sales in North America and improved margins.

Portfolio Diversification

HSY continues to diversify its snacking portfolio through agreement to acquire LesserEvil, a better-for-you snack manufacturer.

Negative Factors

Gross Margin

There is an expectation that tariffs will reduce Hershey's gross margin outlook, skewing the risk-reward to the downside.

Tariffs

The recently enacted 10% tariff on US imports is expected to increase Hershey's cocoa costs by approximately 10%, impacting the company's 2025 earnings outlook.

The Hershey Company Business Overview & Revenue Model

Company Description

The Hershey Company, together with its subsidiaries, engages in the manufacture and sale of confectionery products and pantry items in the United States and internationally. The company operates through three segments: North America Confectionery, North America Salty Snacks, and International. It offers chocolate and non-chocolate confectionery products; gum and mint refreshment products, including mints, chewing gums, and bubble gums; pantry items, such as baking ingredients, toppings, beverages, and sundae syrups; and snack items comprising spreads, meat snacks, bars and snack bites, mixes, popcorn, and protein bars. The company provides its products primarily under the Hershey's, Reese's, Kisses, Jolly Rancher, Almond Joy, Brookside, barkTHINS, Cadbury, Good & Plenty, Heath, Kit Kat, Payday, Rolo, Twizzlers, Whoppers, York, Ice Breakers, Breath Savers, Bubble Yum, Lily's, SkinnyPop, Pirates Booty, Paqui, Dot's Homestyle Pretzels, and ONE Bar brands, as well as under the Pelon Pelo Rico, IO-IO, and Sofit brands. It markets and sells its products to wholesale distributors, chain grocery stores, mass merchandisers, chain drug stores, vending companies, wholesale clubs, convenience stores, dollar stores, concessionaires, and department stores. The company was founded in 1894 and is headquartered in Hershey, Pennsylvania.

How the Company Makes Money

The Hershey Company primarily generates revenue through the sale of its confectionery products, which are distributed through a variety of channels including retail stores, online platforms, and wholesale distributors. Key revenue streams for Hershey include sales from its flagship chocolate brands like Hershey's, Reese's, and Kit Kat, as well as its non-chocolate products such as Twizzlers and Ice Breakers. The company leverages a strong brand portfolio and extensive distribution network to maintain a significant market presence in North America and internationally. Hershey also benefits from partnerships and licensing agreements that expand its brand reach and product offerings. Seasonal and holiday-related products contribute significantly to its earnings, with spikes in sales during periods like Halloween, Christmas, and Easter. Additionally, strategic acquisitions and innovations in product lines support Hershey's growth and revenue diversification.

The Hershey Company Financial Statement Overview

Summary

The Hershey Company presents a robust financial position characterized by strong profitability, efficient cash flow management, and a stable balance sheet. While there are minor areas for improvement, such as enhancing revenue growth and reducing leverage, the company's financial health is fundamentally sound.

Income Statement

The Hershey Company demonstrates strong profitability with consistently high gross and net profit margins. Despite a slight dip in total revenue from the previous year, the company maintains solid EBIT and EBITDA margins, reflecting strong operational efficiency. Revenue growth has been robust over the years, although it showed a minor decline recently.

Balance Sheet

The company exhibits a stable financial structure with a reasonable debt-to-equity ratio, indicating manageable leverage. The return on equity is commendable, reflecting efficient use of shareholder funds. The equity ratio indicates a well-capitalized balance sheet, though there is room for improvement in reducing debt levels.

Cash Flow

Hershey's cash flow management is strong, with robust operating cash flows and healthy free cash flow. The operating cash flow to net income ratio signifies effective cash conversion. However, there has been a slight decline in free cash flow growth recently, which warrants attention.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
10.75B	11.20B	11.16B	10.42B	8.97B	8.15B
	Gross Profit
4.62B	5.30B	5.00B	4.50B	4.05B	3.70B
	EBIT
2.29B	2.90B	2.56B	1.68B	1.61B	1.38B
	EBITDA
2.50B	3.10B	2.75B	2.38B	2.20B	1.90B
	Net Income Common Stockholders
1.65B	2.22B	1.86B	1.64B	1.48B	1.28B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
520.40M	730.75M	401.90M	463.89M	329.27M	1.14B
	Total Assets
12.39B	12.95B	11.90B	10.95B	10.41B	9.13B
	Total Debt
5.66B	5.45B	5.13B	5.08B	5.34B	4.78B
	Net Debt
5.13B	4.72B	4.72B	4.62B	5.01B	3.64B
	Total Liabilities
8.28B	8.23B	7.80B	7.65B	7.66B	6.89B
	Stockholders Equity
4.11B	4.71B	4.10B	3.30B	2.76B	2.24B
Cash Flow		Free Cash Flow
1.82B	1.93B	1.55B	1.81B	1.59B	1.26B
	Operating Cash Flow
2.36B	2.53B	2.32B	2.33B	2.08B	1.70B
	Investing Cash Flow
-879.73M	-960.31M	-1.20B	-787.38M	-2.22B	-531.28M
	Financing Cash Flow
-537.77M	-1.30B	-1.15B	-1.42B	-681.14M	-499.23M

The Hershey Company Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 155.35
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HSY, the sentiment is Negative. The current price of 155.35 is below the 20-day moving average (MA) of 162.01, below the 50-day MA of 163.92, and below the 200-day MA of 172.08, indicating a bearish trend. The MACD of -2.85 indicates Positive momentum. The RSI at 39.91 is Neutral, neither overbought nor oversold. The STOCH value of 16.19 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HSY.

The Hershey Company Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HSY	77 Outperform	$31.47B	19.16	37.48%	3.53%	-5.91%	-19.78%
TR	76 Outperform	$2.97B	27.89	10.39%	1.03%	-5.52%	-5.01%
MDLZ	72 Outperform	$85.64B	24.58	13.27%	2.77%	0.90%	-14.60%
CAG	68 Neutral	$10.69B	32.78	3.67%	6.25%	-3.15%	-65.38%
Sector *	65 Neutral	$8.84B	14.90	4.69%	203.33%	3.49%	-1.84%
SJM	58 Neutral	$11.99B	22.22	-3.55%	3.82%	7.07%	-181.54%
RMCF	41 Neutral	$9.46M	―	-43.58%	―	-3.12%	6.60%

The Hershey Company Corporate Events

Hershey Company Holds Annual Stockholders Meeting

On May 6, 2025, The Hershey Company held its Annual Meeting of Stockholders via webcast, during which several key proposals were voted on. The election of directors saw several individuals elected, while Ernst & Young LLP was ratified as the independent auditor for the fiscal year ending December 31, 2025. Additionally, the compensation of named executive officers was approved on a non-binding advisory basis, and an amended and restated certificate of incorporation was voted for.

Hershey’s Annual Meeting to Review Business Update

On May 6, 2025, The Hershey Company will conduct its Annual Meeting of Stockholders via a live webcast to provide a business review update. This event is significant for stakeholders as it offers insights into the company’s operations and strategic direction, although the presentation materials are not subject to certain regulatory liabilities.