Chocolate company Hershey (NYSE:HSY) will be reporting earnings tomorrow before market hours. Here’s what investors should know.
Hershey missed analysts’ revenue expectations by 2.8% last quarter, reporting revenues of $2.99 billion, down 1.4% year on year. It was a softer quarter for the company, with a miss of analysts’ EPS and organic revenue estimates.
Is Hershey a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Hershey’s revenue to grow 6.9% year on year to $2.84 billion, improving from its flat revenue in the same quarter last year. Adjusted earnings are expected to come in at $2.38 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Hershey has missed Wall Street’s revenue estimates four times over the last two years.
Looking at Hershey’s peers in the shelf-stable food segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Mondelez delivered year-on-year revenue growth of 3.1%, meeting analysts’ expectations, and BellRing Brands reported revenues up 23.8%, topping estimates by 1.2%. BellRing Brands traded down 4.1% following the results.
Read our full analysis of Mondelez’s results here and BellRing Brands’s results here.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market has been optimistic as of late due to a soft landing. This is an economic situation where rate hikes successfully quelled inflation but did not send the economy into a recession. Furthermore, recent rate cuts and Donald Trump's triumph in the 2024 Presidential election have been tailwinds for the market, and while some of the shelf-stable food stocks have shown solid performance, the group has generally underpeformed, with share prices down 3.8% on average over the last month. Hershey is down 15.6% during the same time and is heading into earnings with an average analyst price target of $168.41 (compared to the current share price of $139.60).
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