HERSHEY CO/THE (HSY) Stock Fundamental Analysis
NYSE:HSY - New York Stock Exchange, Inc. - US4278661081 - Common Stock - Currency: USD
HSY gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 89 industry peers in the Food Products industry. HSY gets an excellent profitability rating and is at the same time showing great financial health properties. 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
In the past year HSY was profitable.
HSY had a positive operating cash flow in the past year.
Each year in the past 5 years HSY has 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 11.80%, HSY belongs to the best of the industry, outperforming 94.38% of the companies in the same industry.
HSY has a Return On Equity of 35.18%. This is amongst the best in the industry. HSY outperforms 96.63% of its industry peers.
HSY's Return On Invested Capital of 18.35% is amongst the best of the industry. HSY outperforms 97.75% of its industry peers.
The Average Return On Invested Capital over the past 3 years for HSY is significantly above the industry average of 7.61%.
The 3 year average ROIC (23.99%) for HSY is well above the current ROIC(18.35%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.8% | ||
| ROE | 35.18% | ||
| ROIC | 18.35% |
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
Looking at the Profit Margin, with a value of 15.32%, HSY belongs to the top of the industry, outperforming 94.38% of the companies in the same industry.
In the last couple of years the Profit Margin of HSY has grown nicely.
HSY has a better Operating Margin (21.57%) than 98.88% of its industry peers.
In the last couple of years the Operating Margin of HSY has grown nicely.
HSY has a better Gross Margin (42.57%) than 97.75% of its industry peers.
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 | 21.57% | ||
| PM (TTM) | 15.32% | ||
| GM | 42.57% |
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.
Compared to 1 year ago, HSY has less shares outstanding
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 4.24 indicates that HSY is not in any danger for bankruptcy at the moment.
HSY has a Altman-Z score of 4.24. This is amongst the best in the industry. HSY outperforms 80.90% of its industry peers.
The Debt to FCF ratio of HSY is 3.25, which is a good value as it means it would take HSY, 3.25 years of fcf income to pay off all of its debts.
HSY has a better Debt to FCF ratio (3.25) than 83.15% of its industry peers.
A Debt/Equity ratio of 1.14 is on the high side and indicates that HSY has dependencies on debt financing.
HSY has a Debt to Equity ratio of 1.14. This is in the lower half of the industry: HSY underperforms 75.28% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.14 | ||
| Debt/FCF | 3.25 | ||
| Altman-Z | 4.24 |
ROIC/WACC2.19
WACC8.36%
2.3 Liquidity
A Current Ratio of 1.59 indicates that HSY should not have too much problems paying its short term obligations.
HSY's Current ratio of 1.59 is in line compared to the rest of the industry. HSY outperforms 56.18% of its industry peers.
A Quick Ratio of 1.11 indicates that HSY should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.11, HSY is in the better half of the industry, outperforming 66.29% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.59 | ||
| Quick Ratio | 1.11 |
3. Growth
3.1 Past
The earnings per share for HSY have decreased strongly by -13.51% 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 decrease in Revenue. In the last year, the revenue decreased by -5.91%.
HSY shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.00% yearly.
EPS 1Y (TTM)-13.51%
EPS 3Y9.28%
EPS 5Y10.11%
EPS Q2Q%-31.92%
Revenue 1Y (TTM)-5.91%
Revenue growth 3Y7.68%
Revenue growth 5Y7%
Sales Q2Q%-13.75%
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 1.71% on average per year.
HSY is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.87% yearly.
EPS Next Y-35.76%
EPS Next 2Y-16.83%
EPS Next 3Y-7.05%
EPS Next 5Y1.71%
Revenue Next Year2.45%
Revenue Next 2Y2.74%
Revenue Next 3Y2.61%
Revenue Next 5Y2.87%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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 20.08, the valuation of HSY can be described as rather expensive.
HSY's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 26.55. HSY is valued slightly cheaper when compared to this.
Based on the Price/Forward Earnings ratio of 25.99, the valuation of HSY can be described as expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as HSY.
The average S&P500 Price/Forward Earnings ratio is at 22.40. HSY is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.08 | ||
| Fwd PE | 25.99 |
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 the industry average as 71.91% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.74 | ||
| EV/EBITDA | 13.75 |
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 -7.05% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)1.99
EPS Next 2Y-16.83%
EPS Next 3Y-7.05%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.37%, HSY has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 4.66, HSY pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.39, HSY pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.37% |
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
65.72% 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.
DP65.72%
EPS Next 2Y-16.83%
EPS Next 3Y-7.05%
NYSE:HSY (6/12/2025, 9:37:41 AM)
168.452
+0.4 (+0.24%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners86.36%
Inst Owner Change0.7%
Ins Owners0.13%
Ins Owner Change5.83%
Market Cap34.13B
Analysts56.36
Price Target167.16 (-0.77%)
Short Float %6.93%
Short Ratio6
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.37% |
Yearly Dividend5.33
Dividend Growth(5Y)12.83%
DP65.72%
Div Incr Years15
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)9.23%
Min EPS beat(2)6.26%
Max EPS beat(2)12.21%
EPS beat(4)2
Avg EPS beat(4)-0.81%
Min EPS beat(4)-12.15%
Max EPS beat(4)12.21%
EPS beat(8)6
Avg EPS beat(8)2.32%
EPS beat(12)10
Avg EPS beat(12)4.1%
EPS beat(16)14
Avg EPS beat(16)4.85%
Revenue beat(2)1
Avg Revenue beat(2)0.03%
Min Revenue beat(2)-0.59%
Max Revenue beat(2)0.65%
Revenue beat(4)1
Avg Revenue beat(4)-3.7%
Min Revenue beat(4)-10.97%
Max Revenue beat(4)0.65%
Revenue beat(8)3
Avg Revenue beat(8)-1.73%
Revenue beat(12)7
Avg Revenue beat(12)-0.12%
Revenue beat(16)11
Avg Revenue beat(16)1.36%
PT rev (1m)-0.77%
PT rev (3m)2.05%
EPS NQ rev (1m)-2.2%
EPS NQ rev (3m)-21.88%
EPS NY rev (1m)-2.82%
EPS NY rev (3m)-4.29%
Revenue NQ rev (1m)-0.08%
Revenue NQ rev (3m)0.96%
Revenue NY rev (1m)0.06%
Revenue NY rev (3m)0.16%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.08 | ||
| Fwd PE | 25.99 | ||
| P/S | 3.17 | ||
| P/FCF | 18.74 | ||
| P/OCF | 14.47 | ||
| P/B | 7.28 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.75 |
EPS(TTM)8.39
EY4.98%
EPS(NY)6.48
Fwd EY3.85%
FCF(TTM)8.99
FCFY5.34%
OCF(TTM)11.64
OCFY6.91%
SpS53.08
BVpS23.12
TBVpS-1.17
PEG (NY)N/A
PEG (5Y)1.99
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.8% | ||
| ROE | 35.18% | ||
| ROCE | 21.18% | ||
| ROIC | 18.35% | ||
| ROICexc | 21.25% | ||
| ROICexgc | 43.69% | ||
| OM | 21.57% | ||
| PM (TTM) | 15.32% | ||
| GM | 42.57% | ||
| FCFM | 16.93% |
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%
ROICexcg growth 3Y3.23%
ROICexcg 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 Turnover0.77
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.14 | ||
| Debt/FCF | 3.25 | ||
| Debt/EBITDA | 1.91 | ||
| Cap/Depr | 115.23% | ||
| Cap/Sales | 5% | ||
| Interest Coverage | 12.59 | ||
| Cash Conversion | 84.65% | ||
| Profit Quality | 110.5% | ||
| Current Ratio | 1.59 | ||
| Quick Ratio | 1.11 | ||
| Altman-Z | 4.24 |
F-Score4
WACC8.36%
ROIC/WACC2.19
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)-13.51%
EPS 3Y9.28%
EPS 5Y10.11%
EPS Q2Q%-31.92%
EPS Next Y-35.76%
EPS Next 2Y-16.83%
EPS Next 3Y-7.05%
EPS Next 5Y1.71%
Revenue 1Y (TTM)-5.91%
Revenue growth 3Y7.68%
Revenue growth 5Y7%
Sales Q2Q%-13.75%
Revenue Next Year2.45%
Revenue Next 2Y2.74%
Revenue Next 3Y2.61%
Revenue Next 5Y2.87%
EBIT growth 1Y-18.22%
EBIT growth 3Y12.42%
EBIT growth 5Y11.34%
EBIT Next Year-11.97%
EBIT Next 3Y1.21%
EBIT Next 5Y3.93%
FCF growth 1Y-2.74%
FCF growth 3Y6.4%
FCF growth 5Y5.9%
OCF growth 1Y-2.79%
OCF growth 3Y6.52%
OCF growth 5Y7.49%