HERSHEY CO/THE (HSY) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:HSY - US4278661081 - Common Stock
186 USD
+3.34 (+1.83%)
186 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to HSY. HSY was compared to 87 industry peers in the Food Products industry. While HSY belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. HSY has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
HSY had positive earnings in the past year.
HSY had a positive operating cash flow in the past year.
Each year in the past 5 years HSY has been profitable.
HSY had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 10.01%, HSY belongs to the top of the industry, outperforming 93.18% of the companies in the same industry.
HSY has a Return On Equity of 29.79%. This is amongst the best in the industry. HSY outperforms 95.45% of its industry peers.
HSY's Return On Invested Capital of 16.48% is amongst the best of the industry. HSY outperforms 95.45% 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 28.38%.
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 92.05% 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 95.45% of its industry peers.
In the last couple of years the Operating Margin of HSY has grown nicely.
The Gross Margin of HSY (37.74%) is better than 87.50% of its industry peers.
HSY's Gross Margin has been stable in the last couple of years.
| 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.
HSY has less shares outstanding than it did 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 4.50. This indicates that HSY is financially healthy and has little risk of bankruptcy at the moment.
HSY's Altman-Z score of 4.50 is amongst the best of the industry. HSY outperforms 88.64% 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.
With an excellent Debt to FCF ratio value of 3.05, HSY belongs to the best of the industry, outperforming 84.09% of the companies in the same industry.
HSY has a Debt/Equity ratio of 1.07. This is a high value indicating a heavy dependency on external 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 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | 3.05 | ||
| Altman-Z | 4.5 |
ROIC/WACC2.04
WACC8.06%
2.3 Liquidity
A Current Ratio of 1.36 indicates that HSY should not have too much problems paying its short term obligations.
With a Current ratio value of 1.36, HSY is not doing good in the industry: 60.23% of the companies in the same industry are doing better.
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 44.32% 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.
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
HSY is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 1.55% yearly.
HSY is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.19% yearly.
EPS Next Y-35.65%
EPS Next 2Y-14.17%
EPS Next 3Y-4.79%
EPS Next 5Y1.55%
Revenue Next Year3.42%
Revenue Next 2Y3.59%
Revenue Next 3Y3.3%
Revenue Next 5Y3.19%
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
The Price/Earnings ratio is 25.51, which means the current valuation is very expensive for HSY.
HSY's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of HSY to the average of the S&P500 Index (25.47), we can say HSY is valued inline with the index average.
HSY is valuated quite expensively with a Price/Forward Earnings ratio of 26.94.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HSY is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 34.42. HSY is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.51 | ||
| Fwd PE | 26.94 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as HSY.
64.77% of the companies in the same industry are more expensive than HSY, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.33 | ||
| EV/EBITDA | 16.83 |
4.3 Compensation for Growth
HSY has an outstanding profitability rating, which may justify a higher PE ratio.
A cheap valuation may be justified as HSY's earnings are expected to decrease with -4.79% in the coming years.
PEG (NY)N/A
PEG (5Y)2.52
EPS Next 2Y-14.17%
EPS Next 3Y-4.79%
5. Dividend
5.1 Amount
HSY has a Yearly Dividend Yield of 3.00%.
Compared to an average industry Dividend Yield of 5.20, 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 2.41.
| 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 their dividend for at least 10 years, which is a reliable track record.
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-14.17%
EPS Next 3Y-4.79%
186
+3.34 (+1.83%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners92.52%
Inst Owner Change-0.27%
Ins Owners0.2%
Ins Owner Change1.01%
Market Cap37.71B
Revenue(TTM)11.49B
Net Income(TTM)1.36B
Analysts65.71
Price Target191.2 (2.8%)
Short Float %4.9%
Short Ratio4.3
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)-0.47%
PT rev (3m)1.97%
EPS NQ rev (1m)-12.39%
EPS NQ rev (3m)-11.47%
EPS NY rev (1m)0.37%
EPS NY rev (3m)0.67%
Revenue NQ rev (1m)-0.4%
Revenue NQ rev (3m)-0.17%
Revenue NY rev (1m)0.33%
Revenue NY rev (3m)0.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.51 | ||
| Fwd PE | 26.94 | ||
| P/S | 3.28 | ||
| P/FCF | 21.33 | ||
| P/OCF | 16.45 | ||
| P/B | 8.26 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.83 |
EPS(TTM)7.29
EY3.92%
EPS(NY)6.9
Fwd EY3.71%
FCF(TTM)8.72
FCFY4.69%
OCF(TTM)11.31
OCFY6.08%
SpS56.67
BVpS22.52
TBVpS-1.9
PEG (NY)N/A
PEG (5Y)2.52
Graham Number60.77
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 | 4.5 |
F-Score4
WACC8.06%
ROIC/WACC2.04
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-35.65%
EPS Next 2Y-14.17%
EPS Next 3Y-4.79%
EPS Next 5Y1.55%
Revenue 1Y (TTM)4.71%
Revenue growth 3Y7.68%
Revenue growth 5Y7%
Sales Q2Q%6.49%
Revenue Next Year3.42%
Revenue Next 2Y3.59%
Revenue Next 3Y3.3%
Revenue Next 5Y3.19%
EBIT growth 1Y-21.53%
EBIT growth 3Y12.42%
EBIT growth 5Y11.34%
EBIT Next Year-7.45%
EBIT Next 3Y4.42%
EBIT Next 5Y5.01%
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 25.51 and the Price/Book (PB) ratio is 8.26.
What is the financial health of HERSHEY CO/THE (HSY) stock?
The financial health rating of HERSHEY CO/THE (HSY) is 6 / 10.