HERSHEY CO/THE (HSY) Stock Fundamental Analysis
USA - NYSE:HSY - US4278661081 - Common Stock
182.93 USD
+3.93 (+2.2%)
182.7 USD
-0.23 (-0.13%)
We assign a fundamental rating of 6 out of 10 to HSY. HSY was compared to 87 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 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.
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 has a Return On Invested Capital of 16.48%. This is amongst the best in 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 28.37%.
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
HSY's Profit Margin of 11.84% is amongst the best of the industry. HSY outperforms 91.95% of its industry peers.
In the last couple of years the Profit Margin of HSY has grown nicely.
Looking at the Operating Margin, with a value of 17.27%, HSY belongs to the top of the industry, outperforming 95.40% of the companies in the same industry.
HSY's Operating Margin has improved in the last couple of years.
HSY's Gross Margin of 37.74% is amongst the best of the industry. HSY outperforms 87.36% 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.
Compared to 1 year ago, HSY has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.41 indicates that HSY is not in any danger for bankruptcy at the moment.
HSY has a better Altman-Z score (4.41) than 88.51% 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 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 Debt to Equity ratio of 1.07. This is in the lower half of the industry: HSY underperforms 74.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | 3.05 | ||
| Altman-Z | 4.41 |
ROIC/WACC2.03
WACC8.11%
2.3 Liquidity
A Current Ratio of 1.36 indicates that HSY should not have too much problems paying its short term obligations.
HSY has a Current ratio of 1.36. This is in the lower half of the industry: HSY underperforms 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.
Looking at the Quick ratio, with a value of 0.83, HSY is in line with its industry, outperforming 43.68% 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.
The Earnings Per Share has been growing by 10.11% on average over the past years. This is quite good.
HSY shows a small growth in Revenue. In the last year, the Revenue has grown by 4.71%.
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.
The Revenue is expected to grow by 3.19% on average over the next years.
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
With a Price/Earnings ratio of 25.09, HSY can be considered very expensive at the moment.
HSY's Price/Earnings ratio is in line with the industry average.
The average S&P500 Price/Earnings ratio is at 25.51. HSY is around the same levels.
HSY is valuated quite expensively with a Price/Forward Earnings ratio of 26.50.
HSY's Price/Forward Earnings is on the same level as the industry average.
HSY's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 34.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.09 | ||
| Fwd PE | 26.5 |
4.2 Price Multiples
HSY's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, HSY is valued a bit cheaper than 63.22% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.98 | ||
| EV/EBITDA | 16.26 |
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)2.48
EPS Next 2Y-14.17%
EPS Next 3Y-4.79%
5. Dividend
5.1 Amount
HSY has a Yearly Dividend Yield of 3.08%.
HSY's Dividend Yield is a higher than the industry average which is at 5.17.
HSY's Dividend Yield is a higher than the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.08% |
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
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%
182.93
+3.93 (+2.2%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners92.52%
Inst Owner Change-0.46%
Ins Owners0.2%
Ins Owner Change1.31%
Market Cap37.08B
Revenue(TTM)11.49B
Net Income(TTM)1.36B
Analysts65.71
Price Target194.88 (6.53%)
Short Float %4.9%
Short Ratio4.3
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.08% |
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)1.45%
PT rev (3m)5.29%
EPS NQ rev (1m)-10.56%
EPS NQ rev (3m)-10.24%
EPS NY rev (1m)0.44%
EPS NY rev (3m)0.57%
Revenue NQ rev (1m)-0.33%
Revenue NQ rev (3m)-0.1%
Revenue NY rev (1m)0.35%
Revenue NY rev (3m)0.78%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.09 | ||
| Fwd PE | 26.5 | ||
| P/S | 3.23 | ||
| P/FCF | 20.98 | ||
| P/OCF | 16.18 | ||
| P/B | 8.12 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.26 |
EPS(TTM)7.29
EY3.99%
EPS(NY)6.9
Fwd EY3.77%
FCF(TTM)8.72
FCFY4.77%
OCF(TTM)11.31
OCFY6.18%
SpS56.67
BVpS22.52
TBVpS-1.9
PEG (NY)N/A
PEG (5Y)2.48
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 | 4.41 |
F-Score4
WACC8.11%
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-35.65%
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 25.09 and the Price/Book (PB) ratio is 8.12.
What is the financial health of HERSHEY CO/THE (HSY) stock?
The financial health rating of HERSHEY CO/THE (HSY) is 6 / 10.