HERSHEY CO/THE (HSY) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:HSY - US4278661081 - Common Stock
188.2 USD
+1.45 (+0.78%)
188.2 USD
0 (0%)
HSY gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 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 is valued correctly, but it does not seem to be growing.
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.
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
With an excellent Return On Assets value of 10.01%, HSY belongs to the best of the industry, outperforming 93.10% of the companies in the same industry.
The Return On Equity of HSY (29.79%) is better than 95.40% of its industry peers.
The Return On Invested Capital of HSY (16.48%) is better than 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 28.38%.
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
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.
The Operating Margin of HSY (17.27%) is better 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 86.21% 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.
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
HSY has an Altman-Z score of 4.51. This indicates that HSY is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 4.51, HSY belongs to the best of the industry, outperforming 88.51% of the companies in the same industry.
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.
Looking at the Debt to FCF ratio, with a value of 3.05, HSY belongs to the top 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 has a worse Debt to Equity ratio (1.07) than 74.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | 3.05 | ||
| Altman-Z | 4.51 |
ROIC/WACC2.05
WACC8.02%
2.3 Liquidity
A Current Ratio of 1.36 indicates that HSY should not have too much problems paying its short term obligations.
The Current ratio of HSY (1.36) is worse than 60.92% of its industry peers.
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 (0.83) which is comparable to the rest of the 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.
Looking at the last year, HSY shows a small growth in Revenue. The Revenue has grown by 4.71% in the last year.
HSY shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.00% yearly.
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.
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 25.82, which means the current valuation is very expensive for HSY.
HSY's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 26.15. HSY is around the same levels.
With a Price/Forward Earnings ratio of 27.26, HSY can be considered very expensive at the moment.
HSY's Price/Forward Earnings ratio is in line with the industry average.
HSY is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 36.12, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.82 | ||
| Fwd PE | 27.26 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as HSY.
Based on the Price/Free Cash Flow ratio, HSY is valued a bit cheaper than the industry average as 64.37% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.58 | ||
| EV/EBITDA | 16.89 |
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 -4.79% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)2.55
EPS Next 2Y-14.17%
EPS Next 3Y-4.79%
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 5.21, 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 paid a dividend for at least 10 years, which is 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
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-14.17%
EPS Next 3Y-4.79%
188.2
+1.45 (+0.78%)
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 Cap38.15B
Revenue(TTM)11.49B
Net Income(TTM)1.36B
Analysts65.71
Price Target191.2 (1.59%)
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 | 25.82 | ||
| Fwd PE | 27.26 | ||
| P/S | 3.32 | ||
| P/FCF | 21.58 | ||
| P/OCF | 16.64 | ||
| P/B | 8.36 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.89 |
EPS(TTM)7.29
EY3.87%
EPS(NY)6.9
Fwd EY3.67%
FCF(TTM)8.72
FCFY4.63%
OCF(TTM)11.31
OCFY6.01%
SpS56.67
BVpS22.52
TBVpS-1.9
PEG (NY)N/A
PEG (5Y)2.55
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 | 4.51 |
F-Score4
WACC8.02%
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 25.82 and the Price/Book (PB) ratio is 8.36.
What is the financial health of HERSHEY CO/THE (HSY) stock?
The financial health rating of HERSHEY CO/THE (HSY) is 6 / 10.