The Hershey Company (HSY), based in Pennsylvania, manufactures and sells confectionery products and pantry items in the U.S. and internationally. With a market cap of $38.8 billion, Hershey operates through North America Confectionery, North America Salty Snacks, and International segments. The confectionery giant is expected to release its third-quarter earnings on Thursday, Oct. 24.
Ahead of the event, analysts expect Hershey to report a profit of $2.73 per share, up 5% from $2.60 per share reported in the year-ago quarter. The company has surpassed Wall Street’s adjusted EPS projections in three of the past four quarters while missing on one other occasion. Its adjusted EPS for the last reported quarter declined 36.8% year over year to $1.27, missing the consensus estimates by 11.8%.
For fiscal 2024, analysts expect Hershey to report an adjusted EPS of $9.47, down 1.3% from $9.59 in fiscal 2023. In fiscal 2025, its adjusted EPS is expected to further drop by 1.9% year-over-year to $9.29.
HSY has experienced marginal gains in 2024, lagging behind the S&P 500 Index’s ($SPX) 19.4% gains and the Consumer Staples Select Sector SPDR Fund’s (XLP) 12% returns on a YTD basis.
Despite missing Wall Street’s topline and earnings expectation, Hershey’s share rose 1.1% after the release of its Q2 earnings on Aug. 1. Its net sales dipped 16.7% year over year to $2.1 billion, attributed to softening demand and strategic inventory management. Net income also saw a sharp decline, plummeting 55.6% to $180.9 million.
In light of the underwhelming Q2 performance, Hershey’s has revised its full-year guidance downward. The company now anticipates net sales growth of approximately 2%, a reduction from the previous forecast of 2% to 3% range.
The consensus opinion on HSY stock is neutral, with an overall “Hold” rating. Out of the 21 analysts covering the stock, three recommend “Strong Buy,” 15 suggest “Hold,” one advises “Moderate Buy,” and two advocate a “Strong Sell” rating.
The mean price target of $200.70 suggests a potential upside of 7% from current price levels.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
