HERSHEY CO/THE (HSY) Stock Fundamental Analysis
USA - NYSE:HSY - US4278661081 - Common Stock
170.61 USD
+2.97 (+1.77%)
170.61 USD
0 (0%)
Taking everything into account, HSY scores 6 out of 10 in our fundamental rating. 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.
In the past year HSY had a positive cash flow from operations.
HSY had positive earnings in each of the past 5 years.
HSY had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
HSY has a Return On Assets of 10.01%. This is amongst the best in the industry. HSY outperforms 91.95% 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 has a better Return On Invested Capital (16.48%) than 94.25% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for HSY is below the industry average of 28.25%.
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
The Profit Margin of HSY (11.84%) is better than 90.80% of its industry peers.
In the last couple of years the Profit Margin of HSY has grown nicely.
The Operating Margin of HSY (17.27%) is better than 94.25% of its industry peers.
HSY's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 37.74%, HSY belongs to the best of the industry, outperforming 87.36% of the companies in the same 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
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.
Compared to 1 year ago, HSY has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.26 indicates that HSY is not in any danger for bankruptcy at the moment.
The Altman-Z score of HSY (4.26) is better than 86.21% 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.
Looking at the Debt to FCF ratio, with a value of 3.05, HSY belongs to the top of the industry, outperforming 81.61% 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 has a worse Debt to Equity ratio (1.07) than 73.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | 3.05 | ||
| Altman-Z | 4.26 |
ROIC/WACC2.05
WACC8.05%
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 on the low side compared to the rest of the industry. HSY is outperformed by 60.92% of its industry peers.
A Quick Ratio of 0.83 indicates that HSY may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.83, HSY is in line with its industry, outperforming 42.53% of the companies in the same industry.
| 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.
The Revenue has been growing slightly by 4.71% in the past year.
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
The Earnings Per Share is expected to grow by 1.55% on average over the next years.
Based on estimates for the next years, HSY will show a small growth in Revenue. The Revenue will grow by 3.19% on average per year.
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
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 23.40, the valuation of HSY can be described as rather expensive.
Compared to the rest of the industry, the Price/Earnings ratio of HSY is on the same level as its industry peers.
When comparing the Price/Earnings ratio of HSY to the average of the S&P500 Index (25.83), we can say HSY is valued inline with the index average.
Based on the Price/Forward Earnings ratio of 24.71, the valuation of HSY can be described as rather expensive.
HSY's Price/Forward Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 32.68, HSY is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.4 | ||
| Fwd PE | 24.71 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as HSY.
65.52% 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 | 19.56 | ||
| EV/EBITDA | 15.33 |
4.3 Compensation for Growth
The excellent profitability rating of HSY 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)2.32
EPS Next 2Y-14.17%
EPS Next 3Y-4.79%
5. Dividend
5.1 Amount
HSY has a Yearly Dividend Yield of 3.27%. Purely for dividend investing, there may be better candidates out there.
HSY's Dividend Yield is a higher than the industry average which is at 5.19.
HSY's Dividend Yield is a higher than the S&P500 average which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.27% |
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.
HSY's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP79.75%
EPS Next 2Y-14.17%
EPS Next 3Y-4.79%
170.61
+2.97 (+1.77%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners92.52%
Inst Owner Change-1.52%
Ins Owners0.2%
Ins Owner Change1.23%
Market Cap34.59B
Revenue(TTM)11.49B
Net Income(TTM)1.36B
Analysts65.71
Price Target194.88 (14.23%)
Short Float %5.51%
Short Ratio6.01
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.27% |
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)3.75%
PT rev (3m)16.56%
EPS NQ rev (1m)0.42%
EPS NQ rev (3m)-15.34%
EPS NY rev (1m)0.07%
EPS NY rev (3m)0.2%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.16%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)0.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.4 | ||
| Fwd PE | 24.71 | ||
| P/S | 3.01 | ||
| P/FCF | 19.56 | ||
| P/OCF | 15.09 | ||
| P/B | 7.58 | ||
| P/tB | N/A | ||
| EV/EBITDA | 15.33 |
EPS(TTM)7.29
EY4.27%
EPS(NY)6.9
Fwd EY4.05%
FCF(TTM)8.72
FCFY5.11%
OCF(TTM)11.31
OCFY6.63%
SpS56.67
BVpS22.52
TBVpS-1.9
PEG (NY)N/A
PEG (5Y)2.32
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 | 4.26 |
F-Score4
WACC8.05%
ROIC/WACC2.05
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 23.4 and the Price/Book (PB) ratio is 7.58.
What is the financial health of HERSHEY CO/THE (HSY) stock?
The financial health rating of HERSHEY CO/THE (HSY) is 6 / 10.