NYSE:HSY

Stock Analysis Report

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Executive Summary

The Hershey Company, together with its subsidiaries, manufactures and sells confectionery products. More Details


Snowflake Analysis

Established dividend payer with mediocre balance sheet.


Similar Companies

Share Price & News

How has Hershey's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HSY has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.9%

HSY

-1.6%

US Food

0.08%

US Market


1 Year Return

-9.4%

HSY

0.4%

US Food

12.8%

US Market

Return vs Industry: HSY underperformed the US Food industry which returned 0.4% over the past year.

Return vs Market: HSY underperformed the US Market which returned 12.8% over the past year.


Shareholder returns

HSYIndustryMarket
7 Day-3.9%-1.6%0.08%
30 Day-5.8%-4.0%-1.8%
90 Day6.7%2.3%7.2%
1 Year-7.4%-9.4%2.9%0.4%15.3%12.8%
3 Year39.8%30.0%7.7%-1.3%39.2%29.9%
5 Year71.8%52.2%15.9%0.1%88.3%67.1%

Price Volatility Vs. Market

How volatile is Hershey's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Hershey undervalued compared to its fair value and its price relative to the market?

27.07x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: HSY ($138.92) is trading above our estimate of fair value ($123.87)

Significantly Below Fair Value: HSY is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: HSY is poor value based on its PE Ratio (27.1x) compared to the US Food industry average (25.1x).

PE vs Market: HSY is poor value based on its PE Ratio (27.1x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: HSY is poor value based on its PEG Ratio (3.3x)


Price to Book Ratio

PB vs Industry: HSY is overvalued based on its PB Ratio (16.5x) compared to the US Food industry average (2.1x).


Next Steps

Future Growth

How is Hershey forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

8.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HSY's forecast earnings growth (8.1% per year) is above the savings rate (2.2%).

Earnings vs Market: HSY's earnings (8.1% per year) are forecast to grow slower than the US market (23.1% per year).

High Growth Earnings: HSY's earnings are forecast to grow, but not significantly.

Revenue vs Market: HSY's revenue (2.4% per year) is forecast to grow slower than the US market (9.8% per year).

High Growth Revenue: HSY's revenue (2.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HSY's Return on Equity is forecast to be very high in 3 years time (58.6%).


Next Steps

Past Performance

How has Hershey performed over the past 5 years?

17.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HSY has high quality earnings.

Growing Profit Margin: HSY's current net profit margins (13.5%) are lower than last year (15.5%).


Past Earnings Growth Analysis

Earnings Trend: HSY's earnings have grown by 17.6% per year over the past 5 years.

Accelerating Growth: HSY's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: HSY had negative earnings growth (-11.9%) over the past year, making it difficult to compare to the Food industry average (-4.5%).


Return on Equity

High ROE: Whilst HSY's Return on Equity (60.73%) is outstanding, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is Hershey's financial position?


Financial Position Analysis

Short Term Liabilities: HSY's short term assets ($2.9B) exceed its short term liabilities ($2.2B).

Long Term Liabilities: HSY's short term assets ($2.9B) do not cover its long term liabilities ($4.9B).


Debt to Equity History and Analysis

Debt Level: HSY's debt to equity ratio (284.6%) is considered high.

Reducing Debt: HSY's debt to equity ratio has increased from 196.1% to 284.6% over the past 5 years.

Debt Coverage: HSY's debt is well covered by operating cash flow (34%).

Interest Coverage: HSY's interest payments on its debt are well covered by EBIT (10.9x coverage).


Balance Sheet


Next Steps

Dividend

What is Hershey current dividend yield, its reliability and sustainability?

2.32%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: HSY's dividend (2.32%) is higher than the bottom 25% of dividend payers in the US market (1.66%).

High Dividend: HSY's dividend (2.32%) is low compared to the top 25% of dividend payers in the US market (4.7%).


Stability and Growth of Payments

Stable Dividend: HSY's dividends per share have been stable in the past 10 years.

Growing Dividend: HSY's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (60.3%), HSY's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HSY's dividends in 3 years are forecast to be covered by earnings (52.5% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.3yrs

Average management tenure


CEO

Michele Buck (58 yo)

3.5yrs

Tenure

US$16,787,188

Compensation

Ms. Michele Gross Buck has been the Chairman at The Hershey Company since October 11, 2019 and its Chief Executive Officer and President since March 1, 2017. Ms. Buck is responsible for all day-to-day glob ...


CEO Compensation Analysis

Compensation vs Market: Michele's total compensation ($USD16.79M) is above average for companies of similar size in the US market ($USD11.35M).

Compensation vs Earnings: Michele's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Michele Buck
Chairman3.5yrsUS$16.79m0.081%
$ 23.3m
Steven Voskuil
Senior VP1.33yrsUS$4.02m0.0078%
$ 2.3m
Damien Atkins
Senior VP2.08yrsUS$2.58m0.0032%
$ 910.3k
Melissa Poole
Vice President of Investor Relationsno datano datano data
Rob Gehring
Global Chief Sales Officer4.67yrsno datano data
Christopher Scalia
Senior VP & Chief Human Resources Officer0.67yrno data0.0036%
$ 1.0m
Steven Schiller
President of International3.5yrsno datano data
Doug Straton
Chief Digital Commerce Officerno datano datano data
Jason Reiman
Senior VP & Chief Supply Chain Officer1.25yrsno data0.0043%
$ 1.2m
Charles Raup
President of U.S.0.67yrno data0.0038%
$ 1.1m
Rohit Grover
President-Internationalno datano datano data
Kristen Riggs
Senior VP & Chief Growth Officer0.67yrno data0.0025%
$ 713.8k

1.3yrs

Average Tenure

49yo

Average Age

Experienced Management: HSY's management team is not considered experienced ( 1.3 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Michele Buck
Chairman3.5yrsUS$16.79m0.081%
$ 23.3m
James Brown
Independent Director3.33yrsUS$260.00kno data
David Shedlarz
Independent Director12.08yrsUS$275.00k0.0074%
$ 2.1m
Charles Davis
Lead Independent Director0.92yrUS$383.51k0.012%
$ 3.5m
Robert Malcolm
Independent Director8.75yrsUS$275.00k0.0062%
$ 1.8m
Mary Haben
Independent Director7.08yrsUS$275.00kno data
Anthony Palmer
Independent Director9.42yrsUS$271.50k0.0061%
$ 1.8m
Wendy Schoppert
Independent Director2.75yrsUS$260.00k0.0017%
$ 491.3k
Pamela Arway
Independent Director10.33yrsUS$260.00k0.0077%
$ 2.2m
Mary Koken
Independent Director3.33yrsUS$260.00k0.00029%
$ 83.8k
Juan Perez
Independent Director1.33yrsUS$156.22k0.00084%
$ 242.7k
James Katzman
Independent Director2.33yrsUS$260.00kno data

3.3yrs

Average Tenure

65yo

Average Age

Experienced Board: HSY's board of directors are considered experienced (3.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

The Hershey Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Hershey Company
  • Ticker: HSY
  • Exchange: NYSE
  • Founded: 1894
  • Industry: Packaged Foods and Meats
  • Sector: Food, Beverage & Tobacco
  • Market Cap: US$28.898b
  • Shares outstanding: 208.02m
  • Website: https://www.thehersheycompany.com

Number of Employees


Location

  • The Hershey Company
  • 19 East Chocolate Avenue
  • Hershey
  • Pennsylvania
  • 17033
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HSYNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
HSYDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
0J4XLSE (London Stock Exchange)YesCommon StockGBUSDJan 1968
HSY *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1968
HSHY34BOVESPA (Bolsa de Valores de Sao Paulo)BDR REPR 1/5 COM USD1.00BRBRLJul 2015

Biography

The Hershey Company, together with its subsidiaries, manufactures and sells confectionery products. The company operates through two segments, North America; and International and Other. It offers chocolat ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/09/21 05:36
End of Day Share Price2020/09/18 00:00
Earnings2020/06/28
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.