HERSHEY CO/THE (HSY) Stock Fundamental Analysis
NYSE:HSY - New York Stock Exchange, Inc. - US4278661081 - Common Stock
Overall HSY gets a fundamental rating of 6 out of 10. We evaluated HSY against 92 industry peers in the Food Products industry. HSY has an excellent profitability rating, but there are some minor concerns on its financial health. HSY has a valuation in line with the averages, but 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.
Each year in the past 5 years HSY has been profitable.
In the past 5 years HSY always reported a positive cash flow from operatings.
1.2 Ratios
HSY's Return On Assets of 14.05% is amongst the best of the industry. HSY outperforms 91.86% of its industry peers.
HSY has a better Return On Equity (42.18%) than 98.84% of its industry peers.
HSY has a better Return On Invested Capital (22.53%) than 97.67% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for HSY is significantly above the industry average of 8.99%.
The last Return On Invested Capital (22.53%) for HSY is above the 3 year average (21.99%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.05% | ||
| ROE | 42.18% | ||
| ROIC | 22.53% |
ROA(3y)14.95%
ROA(5y)14.6%
ROE(3y)49.62%
ROE(5y)54.44%
ROIC(3y)21.99%
ROIC(5y)22.23%
1.3 Margins
HSY has a Profit Margin of 16.17%. This is amongst the best in the industry. HSY outperforms 95.35% of its industry peers.
In the last couple of years the Profit Margin of HSY has grown nicely.
HSY has a Operating Margin of 23.04%. This is amongst the best in the industry. HSY outperforms 97.67% of its industry peers.
HSY's Operating Margin has been stable in the last couple of years.
With an excellent Gross Margin value of 44.46%, HSY belongs to the best of the industry, outperforming 96.51% of the companies in the same industry.
HSY's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.04% | ||
| PM (TTM) | 16.17% | ||
| GM | 44.46% |
OM growth 3Y0.84%
OM growth 5Y0.6%
PM growth 3Y2.05%
PM growth 5Y1.99%
GM growth 3Y-0.5%
GM growth 5Y-0.56%
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.
Compared to 1 year ago, HSY has less shares outstanding
Compared to 5 years ago, HSY has less shares outstanding
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.
HSY has a Altman-Z score of 4.26. This is amongst the best in the industry. HSY outperforms 83.72% of its industry peers.
The Debt to FCF ratio of HSY is 3.20, which is a good value as it means it would take HSY, 3.20 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of HSY (3.20) is better than 67.44% of its industry peers.
A Debt/Equity ratio of 1.04 is on the high side and indicates that HSY has dependencies on debt financing.
The Debt to Equity ratio of HSY (1.04) is worse than 77.91% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.04 | ||
| Debt/FCF | 3.2 | ||
| Altman-Z | 4.26 |
ROIC/WACC2.69
WACC8.39%
2.3 Liquidity
HSY has a Current Ratio of 0.85. This is a bad value and indicates that HSY is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of HSY (0.85) is worse than 77.91% of its industry peers.
A Quick Ratio of 0.54 indicates that HSY may have some problems paying its short term obligations.
With a Quick ratio value of 0.54, HSY is not doing good in the industry: 72.09% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.85 | ||
| Quick Ratio | 0.54 |
3. Growth
3.1 Past
HSY shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -9.28%.
The Earnings Per Share has been growing by 12.34% on average over the past years. This is quite good.
HSY shows a decrease in Revenue. In the last year, the revenue decreased by -1.69%.
HSY shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.46% yearly.
EPS 1Y (TTM)-9.28%
EPS 3Y15.09%
EPS 5Y12.34%
EPS Q2Q%-10%
Revenue 1Y (TTM)-1.69%
Revenue growth 3Y11.06%
Revenue growth 5Y7.46%
Sales Q2Q%-1.4%
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 2.26% on average per year.
The Revenue is expected to grow by 2.22% on average over the next years.
EPS Next Y-4.72%
EPS Next 2Y-7.85%
EPS Next 3Y-2.16%
EPS Next 5Y2.26%
Revenue Next Year-0.59%
Revenue Next 2Y0.86%
Revenue Next 3Y1.48%
Revenue Next 5Y2.22%
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 17.57, the valuation of HSY can be described as rather expensive.
Compared to the rest of the industry, the Price/Earnings ratio of HSY indicates a somewhat cheap valuation: HSY is cheaper than 60.47% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 27.96. HSY is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 18.77, which indicates a rather expensive current valuation of HSY.
Based on the Price/Forward Earnings ratio, HSY is valued a bit cheaper than 65.12% of the companies in the same industry.
HSY's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.11.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.57 | ||
| Fwd PE | 18.77 |
4.2 Price Multiples
HSY's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HSY is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.71 | ||
| EV/EBITDA | 11.64 |
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 -2.16% in the coming years.
PEG (NY)N/A
PEG (5Y)1.42
EPS Next 2Y-7.85%
EPS Next 3Y-2.16%
5. Dividend
5.1 Amount
HSY has a Yearly Dividend Yield of 3.38%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.84, 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 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.38% |
5.2 History
The dividend of HSY is nicely growing with an annual growth rate of 10.18%!
HSY has paid a dividend for at least 10 years, which is 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)10.18%
Div Incr Years15
Div Non Decr Years34
5.3 Sustainability
HSY pays out 59.32% of its income as dividend. This is a bit on the high side, but may be sustainable.
HSY's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP59.32%
EPS Next 2Y-7.85%
EPS Next 3Y-2.16%
HERSHEY CO/THE
NYSE:HSY (1/17/2025, 8:06:43 PM)
After market: 152.87 0 (0%)152.87
-1.15 (-0.75%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners82.01%
Inst Owner Change-0.56%
Ins Owners0.14%
Ins Owner Change-0.02%
Market Cap30.93B
Analysts54.55
Price Target187.14 (22.42%)
Short Float %4.72%
Short Ratio2.9
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.38% |
Yearly Dividend4.34
Dividend Growth(5Y)10.18%
DP59.32%
Div Incr Years15
Div Non Decr Years34
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-10.84%
Min EPS beat(2)-12.15%
Max EPS beat(2)-9.53%
EPS beat(4)2
Avg EPS beat(4)-2.28%
Min EPS beat(4)-12.15%
Max EPS beat(4)10.1%
EPS beat(8)6
Avg EPS beat(8)2.88%
EPS beat(12)10
Avg EPS beat(12)4.47%
EPS beat(16)14
Avg EPS beat(16)4.27%
Revenue beat(2)0
Avg Revenue beat(2)-7.42%
Min Revenue beat(2)-10.97%
Max Revenue beat(2)-3.88%
Revenue beat(4)1
Avg Revenue beat(4)-3.52%
Min Revenue beat(4)-10.97%
Max Revenue beat(4)3.49%
Revenue beat(8)4
Avg Revenue beat(8)-1.28%
Revenue beat(12)8
Avg Revenue beat(12)1.17%
Revenue beat(16)12
Avg Revenue beat(16)1.99%
PT rev (1m)0.5%
PT rev (3m)-9.72%
EPS NQ rev (1m)0%
EPS NQ rev (3m)3.54%
EPS NY rev (1m)-0.26%
EPS NY rev (3m)-4.72%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.16%
Revenue NY rev (1m)-0.08%
Revenue NY rev (3m)-1.6%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.57 | ||
| Fwd PE | 18.77 | ||
| P/S | 2.82 | ||
| P/FCF | 18.71 | ||
| P/OCF | 13.18 | ||
| P/B | 7.36 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.64 |
EPS(TTM)8.7
EY5.69%
EPS(NY)8.14
Fwd EY5.33%
FCF(TTM)8.17
FCFY5.35%
OCF(TTM)11.6
OCFY7.59%
SpS54.22
BVpS20.78
TBVpS-3.34
PEG (NY)N/A
PEG (5Y)1.42
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.05% | ||
| ROE | 42.18% | ||
| ROCE | 30% | ||
| ROIC | 22.53% | ||
| ROICexc | 24.07% | ||
| ROICexgc | 52.53% | ||
| OM | 23.04% | ||
| PM (TTM) | 16.17% | ||
| GM | 44.46% | ||
| FCFM | 15.07% |
ROA(3y)14.95%
ROA(5y)14.6%
ROE(3y)49.62%
ROE(5y)54.44%
ROIC(3y)21.99%
ROIC(5y)22.23%
ROICexc(3y)23.03%
ROICexc(5y)24.06%
ROICexgc(3y)54.87%
ROICexgc(5y)57.91%
ROCE(3y)28.09%
ROCE(5y)27.47%
ROICexcg growth 3Y-3.94%
ROICexcg growth 5Y-1.48%
ROICexc growth 3Y-2.01%
ROICexc growth 5Y-1.13%
OM growth 3Y0.84%
OM growth 5Y0.6%
PM growth 3Y2.05%
PM growth 5Y1.99%
GM growth 3Y-0.5%
GM growth 5Y-0.56%
F-Score5
Asset Turnover0.87
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.04 | ||
| Debt/FCF | 3.2 | ||
| Debt/EBITDA | 1.47 | ||
| Cap/Depr | 154.84% | ||
| Cap/Sales | 6.32% | ||
| Interest Coverage | 14.21 | ||
| Cash Conversion | 78.88% | ||
| Profit Quality | 93.24% | ||
| Current Ratio | 0.85 | ||
| Quick Ratio | 0.54 | ||
| Altman-Z | 4.26 |
F-Score5
WACC8.39%
ROIC/WACC2.69
Cap/Depr(3y)159.39%
Cap/Depr(5y)147.41%
Cap/Sales(3y)5.81%
Cap/Sales(5y)5.36%
Profit Quality(3y)100.5%
Profit Quality(5y)104.95%
High Growth Momentum
Growth
EPS 1Y (TTM)-9.28%
EPS 3Y15.09%
EPS 5Y12.34%
EPS Q2Q%-10%
EPS Next Y-4.72%
EPS Next 2Y-7.85%
EPS Next 3Y-2.16%
EPS Next 5Y2.26%
Revenue 1Y (TTM)-1.69%
Revenue growth 3Y11.06%
Revenue growth 5Y7.46%
Sales Q2Q%-1.4%
Revenue Next Year-0.59%
Revenue Next 2Y0.86%
Revenue Next 3Y1.48%
Revenue Next 5Y2.22%
EBIT growth 1Y-3.82%
EBIT growth 3Y11.99%
EBIT growth 5Y8.11%
EBIT Next Year9.26%
EBIT Next 3Y2.98%
EBIT Next 5Y4.05%
FCF growth 1Y-4.46%
FCF growth 3Y7.58%
FCF growth 5Y4.07%
OCF growth 1Y4.84%
OCF growth 3Y11.23%
OCF growth 5Y7.74%