HERSHEY CO/THE (HSY) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:HSY - US4278661081 - Common Stock
182.3 USD
-0.16 (-0.09%)
182.3 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to HSY. HSY was compared to 86 industry peers in the Food Products industry. While HSY has a great profitability rating, there are some minor concerns on its financial health. HSY does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
In the past year HSY was profitable.
HSY had a positive operating cash flow in the past year.
HSY had positive earnings in each of the past 5 years.
In the past 5 years HSY always reported a positive cash flow from operatings.
1.2 Ratios
HSY's Return On Assets of 10.01% is amongst the best of the industry. HSY outperforms 93.10% of its industry peers.
HSY's Return On Equity of 29.79% is amongst the best of the industry. HSY outperforms 95.40% of its industry peers.
HSY's Return On Invested Capital of 16.48% is amongst the best of the industry. HSY outperforms 95.40% of its industry peers.
HSY had an Average Return On Invested Capital over the past 3 years of 23.99%. This is below the industry average of 28.77%.
The 3 year average ROIC (23.99%) for HSY is well above the current ROIC(16.48%). The reason for the recent decline needs to be investigated.
| 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
The Profit Margin of HSY (11.84%) is better than 91.95% of its industry peers.
HSY's Profit Margin has improved in the last couple of years.
HSY has a better Operating Margin (17.27%) than 95.40% of its industry peers.
In the last couple of years the Operating Margin of HSY has grown nicely.
HSY has a Gross Margin of 37.74%. This is amongst the best in the industry. HSY outperforms 85.06% of its industry peers.
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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), HSY is creating value.
The number of shares outstanding for HSY has been reduced compared to 1 year ago.
The number of shares outstanding for HSY has been reduced compared to 5 years ago.
The debt/assets ratio for HSY has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.45 indicates that HSY is not in any danger for bankruptcy at the moment.
HSY's Altman-Z score of 4.45 is amongst the best of the industry. HSY outperforms 87.36% of its industry peers.
HSY has a debt to FCF ratio of 3.05. This is a good value and a sign of high solvency as HSY would need 3.05 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 3.05, HSY belongs to the best of the industry, outperforming 83.91% of the companies in the same industry.
A Debt/Equity ratio of 1.07 is on the high side and indicates that HSY has dependencies on debt financing.
HSY's Debt to Equity ratio of 1.07 is on the low side compared to the rest of the industry. HSY is outperformed by 74.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | 3.05 | ||
| Altman-Z | 4.45 |
ROIC/WACC2.03
WACC8.12%
2.3 Liquidity
A Current Ratio of 1.36 indicates that HSY should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.36, HSY is doing worse than 60.92% of the companies in the same industry.
HSY has a Quick Ratio of 1.36. This is a bad value and indicates that HSY is not financially healthy enough and could expect problems in meeting its short term obligations.
HSY has a Quick ratio of 0.83. This is comparable to the rest of the industry: HSY outperforms 44.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.36 | ||
| Quick Ratio | 0.83 |
3. Growth
3.1 Past
The earnings per share for HSY have decreased strongly by -16.21% in the last year.
Measured over the past years, HSY shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.11% on average per year.
HSY shows a small growth in Revenue. In the last year, the Revenue has grown by 4.71%.
Measured over the past years, HSY shows a small growth in Revenue. The Revenue has been growing by 7.00% on average per year.
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 1.22% on average per year.
Based on estimates for the next years, HSY will show a small growth in Revenue. The Revenue will grow by 3.25% on average per year.
EPS Next Y-35.49%
EPS Next 2Y-13.95%
EPS Next 3Y-4.84%
EPS Next 5Y1.22%
Revenue Next Year3.64%
Revenue Next 2Y3.63%
Revenue Next 3Y3.39%
Revenue Next 5Y3.25%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
HSY is valuated quite expensively with a Price/Earnings ratio of 25.01.
HSY's Price/Earnings is on the same level as the industry average.
HSY is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.49, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 26.28, the valuation of HSY can be described as expensive.
HSY's Price/Forward Earnings is on the same level as the industry average.
The average S&P500 Price/Forward Earnings ratio is at 23.69. HSY is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.01 | ||
| Fwd PE | 26.28 |
4.2 Price Multiples
HSY's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HSY indicates a somewhat cheap valuation: HSY is cheaper than 64.37% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.91 | ||
| EV/EBITDA | 16.53 |
4.3 Compensation for Growth
The excellent profitability rating of HSY may justify a higher PE ratio.
HSY's earnings are expected to decrease with -4.84% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)2.47
EPS Next 2Y-13.95%
EPS Next 3Y-4.84%
5. Dividend
5.1 Amount
HSY has a Yearly Dividend Yield of 3.00%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 5.10, HSY pays a bit more dividend than its industry peers.
HSY's Dividend Yield is a higher than the S&P500 average which is at 2.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3% |
5.2 History
On average, the dividend of HSY grows each year by 12.83%, which is quite nice.
HSY has been paying a dividend for at least 10 years, so it has a reliable track record.
HSY has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)12.83%
Div Incr Years15
Div Non Decr Years34
5.3 Sustainability
79.75% of the earnings are spent on dividend by HSY. This is not a sustainable payout ratio.
The dividend of HSY is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP79.75%
EPS Next 2Y-13.95%
EPS Next 3Y-4.84%
182.3
-0.16 (-0.09%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners88.95%
Inst Owner Change-0.25%
Ins Owners0.19%
Ins Owner Change1.14%
Market Cap36.97B
Revenue(TTM)11.49B
Net Income(TTM)1.36B
Analysts65.71
Price Target192.26 (5.46%)
Short Float %6.75%
Short Ratio5.93
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3% |
Yearly Dividend5.33
Dividend Growth(5Y)12.83%
DP79.75%
Div Incr Years15
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)20.61%
Min EPS beat(2)20.39%
Max EPS beat(2)20.83%
EPS beat(4)4
Avg EPS beat(4)14.92%
Min EPS beat(4)6.26%
Max EPS beat(4)20.83%
EPS beat(8)6
Avg EPS beat(8)6.32%
EPS beat(12)10
Avg EPS beat(12)6.89%
EPS beat(16)14
Avg EPS beat(16)7.08%
Revenue beat(2)2
Avg Revenue beat(2)1.9%
Min Revenue beat(2)1.19%
Max Revenue beat(2)2.62%
Revenue beat(4)3
Avg Revenue beat(4)0.97%
Min Revenue beat(4)-0.59%
Max Revenue beat(4)2.62%
Revenue beat(8)4
Avg Revenue beat(8)-1.28%
Revenue beat(12)7
Avg Revenue beat(12)-0.53%
Revenue beat(16)11
Avg Revenue beat(16)1.12%
PT rev (1m)-1.34%
PT rev (3m)2.53%
EPS NQ rev (1m)-1.2%
EPS NQ rev (3m)-11.44%
EPS NY rev (1m)0.26%
EPS NY rev (3m)0.93%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)-0.13%
Revenue NY rev (1m)0.21%
Revenue NY rev (3m)0.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.01 | ||
| Fwd PE | 26.28 | ||
| P/S | 3.22 | ||
| P/FCF | 20.91 | ||
| P/OCF | 16.13 | ||
| P/B | 8.1 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.53 |
EPS(TTM)7.29
EY4%
EPS(NY)6.94
Fwd EY3.81%
FCF(TTM)8.72
FCFY4.78%
OCF(TTM)11.3
OCFY6.2%
SpS56.66
BVpS22.51
TBVpS-1.9
PEG (NY)N/A
PEG (5Y)2.47
Graham Number60.76
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.01% | ||
| ROE | 29.79% | ||
| ROCE | 19.16% | ||
| ROIC | 16.48% | ||
| ROICexc | 18.51% | ||
| ROICexgc | 39.09% | ||
| OM | 17.27% | ||
| PM (TTM) | 11.84% | ||
| GM | 37.74% | ||
| FCFM | 15.39% |
ROA(3y)15.94%
ROA(5y)15.2%
ROE(3y)47.46%
ROE(5y)50.64%
ROIC(3y)23.99%
ROIC(5y)22.85%
ROICexc(3y)25.42%
ROICexc(5y)24.68%
ROICexgc(3y)57.82%
ROICexgc(5y)56.6%
ROCE(3y)30.24%
ROCE(5y)28.38%
ROICexgc growth 3Y3.23%
ROICexgc growth 5Y-4.21%
ROICexc growth 3Y8.1%
ROICexc growth 5Y0.23%
OM growth 3Y4.4%
OM growth 5Y4.06%
PM growth 3Y6.38%
PM growth 5Y6.61%
GM growth 3Y1.55%
GM growth 5Y0.85%
F-Score4
Asset Turnover0.85
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | 3.05 | ||
| Debt/EBITDA | 1.97 | ||
| Cap/Depr | 105.99% | ||
| Cap/Sales | 4.57% | ||
| Interest Coverage | 9.57 | ||
| Cash Conversion | 92.48% | ||
| Profit Quality | 130% | ||
| Current Ratio | 1.36 | ||
| Quick Ratio | 0.83 | ||
| Altman-Z | 4.45 |
F-Score4
WACC8.12%
ROIC/WACC2.03
Cap/Depr(3y)151.29%
Cap/Depr(5y)152.21%
Cap/Sales(3y)5.77%
Cap/Sales(5y)5.65%
Profit Quality(3y)93.33%
Profit Quality(5y)97.13%
High Growth Momentum
Growth
EPS 1Y (TTM)-16.21%
EPS 3Y9.28%
EPS 5Y10.11%
EPS Q2Q%-44.44%
EPS Next Y-35.49%
EPS Next 2Y-13.95%
EPS Next 3Y-4.84%
EPS Next 5Y1.22%
Revenue 1Y (TTM)4.71%
Revenue growth 3Y7.68%
Revenue growth 5Y7%
Sales Q2Q%6.49%
Revenue Next Year3.64%
Revenue Next 2Y3.63%
Revenue Next 3Y3.39%
Revenue Next 5Y3.25%
EBIT growth 1Y-21.53%
EBIT growth 3Y12.42%
EBIT growth 5Y11.34%
EBIT Next Year-6.5%
EBIT Next 3Y5.16%
EBIT Next 5Y5.08%
FCF growth 1Y8.78%
FCF growth 3Y6.4%
FCF growth 5Y5.9%
OCF growth 1Y-1.75%
OCF growth 3Y6.52%
OCF growth 5Y7.49%
HERSHEY CO/THE / HSY FAQ
What is the fundamental rating for HSY stock?
ChartMill assigns a fundamental rating of 6 / 10 to HSY.
What is the valuation status of HERSHEY CO/THE (HSY) stock?
ChartMill assigns a valuation rating of 4 / 10 to HERSHEY CO/THE (HSY). This can be considered as Fairly Valued.
What is the profitability of HSY stock?
HERSHEY CO/THE (HSY) has a profitability rating of 9 / 10.
What is the valuation of HERSHEY CO/THE based on its PE and PB ratios?
The Price/Earnings (PE) ratio for HERSHEY CO/THE (HSY) is 25.01 and the Price/Book (PB) ratio is 8.1.
What is the financial health of HERSHEY CO/THE (HSY) stock?
The financial health rating of HERSHEY CO/THE (HSY) is 6 / 10.