HERSHEY CO/THE (HSY.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:HSY - US4278661081 - Common Stock
169.14 EUR
+3.3 (+1.99%)
We assign a fundamental rating of 6 out of 10 to HSY. HSY was compared to 62 industry peers in the Food Products industry. While HSY has a great profitability rating, there are some minor concerns on its financial health. HSY is valued expensive and it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- In the past year HSY was profitable.
- In the past year HSY had a positive cash flow from operations.
- In the past 5 years HSY has always been profitable.
- Each year in the past 5 years HSY had a positive operating cash flow.
1.2 Ratios
- The Return On Assets of HSY (10.01%) is better than 89.23% of its industry peers.
- HSY has a Return On Equity of 29.79%. This is amongst the best in the industry. HSY outperforms 92.31% of its industry peers.
- HSY has a better Return On Invested Capital (16.48%) than 93.85% of its industry peers.
- HSY had an Average Return On Invested Capital over the past 3 years of 23.99%. This is significantly above the industry average of 7.38%.
- The last Return On Invested Capital (16.48%) for HSY is well below the 3 year average (23.99%), which needs to be investigated, but indicates that HSY had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.01% | ||
| ROE | 29.79% | ||
| ROIC | 16.48% |
ROA(3y)15.94%
ROA(5y)15.2%
ROE(3y)47.46%
ROE(5y)50.64%
ROIC(3y)23.99%
ROIC(5y)22.85%
1.3 Margins
- HSY has a Profit Margin of 11.84%. This is amongst the best in the industry. HSY outperforms 86.15% of its industry peers.
- HSY's Profit Margin has improved in the last couple of years.
- The Operating Margin of HSY (17.27%) is better than 92.31% of its industry peers.
- HSY's Operating Margin has improved in the last couple of years.
- HSY has a Gross Margin (37.74%) which is comparable to the rest of the industry.
- In the last couple of years the Gross Margin of HSY has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.27% | ||
| PM (TTM) | 11.84% | ||
| GM | 37.74% |
OM growth 3Y4.4%
OM growth 5Y4.06%
PM growth 3Y6.38%
PM growth 5Y6.61%
GM growth 3Y1.55%
GM growth 5Y0.85%
2. Health
2.1 Basic Checks
- HSY has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
- The number of shares outstanding for HSY has been reduced compared to 1 year ago.
- HSY has less shares outstanding than it did 5 years ago.
- The debt/assets ratio for HSY has been reduced compared to a year ago.
2.2 Solvency
- HSY has an Altman-Z score of 4.67. This indicates that HSY is financially healthy and has little risk of bankruptcy at the moment.
- HSY's Altman-Z score of 4.67 is amongst the best of the industry. HSY outperforms 90.77% of its industry peers.
- The Debt to FCF ratio of HSY is 3.05, which is a good value as it means it would take HSY, 3.05 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of HSY (3.05) is better than 83.08% of its industry peers.
- HSY has a Debt/Equity ratio of 1.07. This is a high value indicating a heavy dependency on external financing.
- HSY has a worse Debt to Equity ratio (1.07) than 70.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | 3.05 | ||
| Altman-Z | 4.67 |
ROIC/WACC2.02
WACC8.16%
2.3 Liquidity
- A Current Ratio of 1.36 indicates that HSY should not have too much problems paying its short term obligations.
- HSY's Current ratio of 1.36 is in line compared to the rest of the industry. HSY outperforms 60.00% of its industry peers.
- A Quick Ratio of 0.83 indicates that HSY may have some problems paying its short term obligations.
- HSY's Quick ratio of 0.83 is in line compared to the rest of the industry. HSY outperforms 52.31% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.36 | ||
| Quick Ratio | 0.83 |
3. Growth
3.1 Past
- HSY shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -16.21%.
- HSY shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.11% yearly.
- HSY shows a small growth in Revenue. In the last year, the Revenue has grown by 4.71%.
- The Revenue has been growing slightly by 7.00% on average over the past years.
EPS 1Y (TTM)-16.21%
EPS 3Y9.28%
EPS 5Y10.11%
EPS Q2Q%-44.44%
Revenue 1Y (TTM)4.71%
Revenue growth 3Y7.68%
Revenue growth 5Y7%
Sales Q2Q%6.49%
3.2 Future
- Based on estimates for the next years, HSY will show a small growth in Earnings Per Share. The EPS will grow by 2.75% on average per year.
- Based on estimates for the next years, HSY will show a small growth in Revenue. The Revenue will grow by 3.41% on average per year.
EPS Next Y-35.36%
EPS Next 2Y-12.7%
EPS Next 3Y-3.89%
EPS Next 5Y2.75%
Revenue Next Year3.72%
Revenue Next 2Y3.63%
Revenue Next 3Y3.36%
Revenue Next 5Y3.41%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 27.24, the valuation of HSY can be described as expensive.
- Based on the Price/Earnings ratio, HSY is valued a bit more expensive than the industry average as 63.08% of the companies are valued more cheaply.
- HSY is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- HSY is valuated quite expensively with a Price/Forward Earnings ratio of 27.81.
- HSY's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. HSY is more expensive than 70.77% of the companies in the same industry.
- When comparing the Price/Forward Earnings ratio of HSY to the average of the S&P500 Index (25.98), we can say HSY is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.24 | ||
| Fwd PE | 27.81 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of HSY indicates a slightly more expensive valuation: HSY is more expensive than 73.85% of the companies listed in the same industry.
- HSY's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.78 | ||
| EV/EBITDA | 17.87 |
4.3 Compensation for Growth
- HSY has an outstanding profitability rating, which may justify a higher PE ratio.
- HSY's earnings are expected to decrease with -3.89% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)2.7
EPS Next 2Y-12.7%
EPS Next 3Y-3.89%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.87%, HSY has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 2.38, HSY has a dividend in line with its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.81, HSY pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.87% |
5.2 History
- The dividend of HSY is nicely growing with an annual growth rate of 12.83%!
Dividend Growth(5Y)12.83%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
- HSY pays out 79.75% of its income as dividend. This is not a sustainable payout ratio.
- HSY's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP79.75%
EPS Next 2Y-12.7%
EPS Next 3Y-3.89%
HERSHEY CO/THE / HSY.DE FAQ
What is the fundamental rating for HSY stock?
ChartMill assigns a fundamental rating of 6 / 10 to HSY.DE.
Can you provide the valuation status for HERSHEY CO/THE?
ChartMill assigns a valuation rating of 2 / 10 to HERSHEY CO/THE (HSY.DE). This can be considered as Overvalued.
What is the profitability of HSY stock?
HERSHEY CO/THE (HSY.DE) has a profitability rating of 9 / 10.
Can you provide the PE and PB ratios for HSY stock?
The Price/Earnings (PE) ratio for HERSHEY CO/THE (HSY.DE) is 27.24 and the Price/Book (PB) ratio is 8.82.
Can you provide the expected EPS growth for HSY stock?
The Earnings per Share (EPS) of HERSHEY CO/THE (HSY.DE) is expected to decline by -35.36% in the next year.