Company Performance - Hershey's stock closed at $197.63, reflecting a decrease of -0.83% from the previous day, which is less than the S&P 500's daily loss of 0.29% [1] - Over the last month, Hershey's shares increased by 0.69%, underperforming the Consumer Staples sector's gain of 3.54% and the S&P 500's gain of 1.57% [1] - The upcoming earnings disclosure is anticipated, with expected EPS of $2.78, representing a 6.92% increase from the prior-year quarter, and projected revenue of $3.13 billion, indicating a 3.39% rise from the equivalent quarter last year [1][2] Analyst Estimates - For the entire year, the Zacks Consensus Estimates forecast earnings of $9.49 per share and revenue of $11.36 billion, showing changes of -1.04% and +1.78% respectively compared to the previous year [2] - Recent changes to analyst estimates for Hershey suggest evolving short-term business trends, with positive revisions indicating a favorable business outlook [2] Zacks Rank and Valuation - The Zacks Rank system rates Hershey at 3 (Hold), with a historical average annual return of +25% for 1 ranked stocks since 1988 [3] - Hershey has a Forward P/E ratio of 21, which is a premium compared to the industry average Forward P/E of 19.17 [3] - The company holds a PEG ratio of 5.79, while the Food - Confectionery industry has an average PEG ratio of 3.94 [3] Industry Overview - The Food - Confectionery industry is part of the Consumer Staples sector and currently holds a Zacks Industry Rank of 209, placing it in the bottom 18% of all industries [4] - The Zacks Industry Rank assesses the strength of industry groups, indicating that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [4]

Core Insights - The Hershey Company (NYSE: HSY) has experienced an almost 9% increase in its stock price since April, although it still lags behind the ~19% increase in the S&P 500 [1] Company Performance - The Hershey Company's stock price has shown a notable increase of nearly 9% year to date [1] Market Context - The performance of The Hershey Company is compared to the broader market, specifically the S&P 500, which has increased by approximately 19% [1]

Core Viewpoint - Hershey presents a buying opportunity as it is currently priced attractively despite facing short-term challenges related to cocoa prices and distribution system upgrades [1][2][8] Group 1: Valuation Metrics - Hershey's price-to-sales ratio (P/S) is approximately 3.8, below its five-year average of 4.1, indicating it is fairly priced [2] - The price-to-earnings ratio (P/E) stands at 22.5, compared to a five-year average of 25.5, further suggesting the stock is attractively priced [2] - The dividend yield is around 2.7%, higher than the five-year average of 2%, making it appealing for dividend investors [2] Group 2: Business Performance - Hershey is undergoing upgrades to its distribution system, which has temporarily affected sales, leading to a year-over-year sales decline of over 16% in the second quarter [4][5] - Approximately 9 percentage points of the sales drop are attributed to the system upgrade, while 7 percentage points are due to seasonal factors [5] - The current sales dip is viewed as a necessary adjustment in the process of long-term business improvement [4][5] Group 3: Cocoa Price Concerns - Cocoa prices are at near all-time highs, influenced by inflation, aging crops, and plant diseases, which could impact Hershey's earnings [6] - Hershey plans to implement price increases of around 6% to 7% to offset rising cocoa costs, but will do so gradually to manage margins [6] - The company's historical resilience in the chocolate market suggests that consumers are willing to accept higher prices for chocolate products [6][7]

Core Insights - Jolly Rancher has launched a new product called Jolly Rancher Ropes, which combines two iconic flavors in a chewy format, enhancing the snacking experience [1][2] - The new product is available in two flavor combinations: Green Apple + Watermelon and Blue Raspberry + Cherry, aimed at appealing to younger consumers [2] Product Details - Jolly Rancher Ropes are designed to deliver maximum fruit flavor with a unique dual-flavor pack, ensuring a rich taste experience with every chew [2] - The product is available in 6 oz and 10 oz bags at retailers nationwide and online, catering to both individual consumers and those looking to share [2] Company Overview - The Hershey Company, which owns the Jolly Rancher brand, is a leading snacks company with over 20,000 employees and more than 90 brand names, generating over $11.2 billion in annual revenues [4] - Hershey has a long-standing commitment to ethical and sustainable operations, with a focus on community support and education initiatives [4]

Core Insights - Winnebago Industries, Inc. will showcase nearly 150 new models at the Hershey RV Show, highlighting advancements in technology, design, and comfort across its premium RV brands [1][2] Group 1: Winnebago Brand Highlights - The Winnebago brand will display 101 units, including the debut of the Revel Sport camper van, which features off-road performance and off-grid capabilities [3][4] - The new View / Navion model integrates the Winnebago Connect intelligent RV platform, offering modern interiors and smart storage solutions [4] Group 2: Grand Design RV Innovations - Grand Design RV will introduce its 2025 product lineup, including the Lineage Series M, a Class C motorhome built on the Mercedes-Benz Sprinter 4500 chassis, and the expanded Transcend lineup [5][6] - The Reflection series will receive interior updates for 2025, enhancing comfort and functionality with new furnishings and modern lighting [6][7] Group 3: Newmar Luxury Offerings - Newmar will debut the Northern Star, an affordable diesel pusher, alongside 19 luxury Class A and Class Super C coaches at the Hershey Show [8][9] - The 2025 Onyx Package will be showcased, featuring a striking blackout finish for select Newmar models [9]

Core Viewpoint - The Hershey Company has faced volatility in its stock performance, currently down over 25% from its record high in early 2023, but there are reasons for a bullish long-term outlook despite recent disappointing results [1]. Group 1: Company Overview - Hershey is a globally recognized leader in chocolate with a history of over 125 years, also owning iconic brands like Reese's, KitKat, Jolly Rancher, and Twizzlers [2]. - The company has expanded into salty snacks with products like SkinnyPop Popcorn and Dot's Pretzels, which are important growth drivers [2]. Group 2: Recent Performance - In Q2 2024, Hershey experienced a 16.7% drop in sales and a 38% decline in earnings per share (EPS) to $1.27 compared to Q2 2023 [3]. - The decline was largely attributed to the implementation of a new enterprise software system and planned inventory adjustments, while the North American salty snacks group saw a 9% volume increase [3][4]. - Hershey is guiding for 2024 net sales growth of around 2% and expects EPS to be "down slightly" from $9.59 in 2023 [4]. Group 3: Future Outlook - The company has various strategies to adapt to market changes, including resource allocation and pricing management, with optimism for international market expansion [5]. - Hershey has a strong history of dividend growth, having increased its quarterly dividend rate every year since 1988, with a recent 15% increase to $1.37 per share, yielding 2.7% [5]. - The stock is currently trading at a forward price-to-earnings ratio of 21, which is below its five-year average of 26, indicating potential undervaluation [6]. Group 4: Long-term Projections - Management targets adjusted annual EPS growth of 6% to 8% over the long term, with predictions that the stock price could reach $300 by 2029, representing approximately 50% upside from current levels [7][8].

Group 1 - Hershey is a well-established consumer-staples company known for its profitability and consistent dividend payments, but there are concerns about the sustainability of its yield hikes [1][2] - The current quarterly dividend is $1.37 per share, translating to an annualized amount of $5.48, contingent on the company maintaining this payout level [2] - Hershey reported a Q2 earnings-per-share (EPS) of $1.27, missing expectations of $1.44, with a significant year-over-year earnings decline of 36.8% attributed to reduced consumer discretionary spending [2][3] Group 2 - Hershey's forward annual dividend yield stands at 2.68%, which is higher than the consumer-defensive sector average of 2.13% [3] - The company's dividend payout ratio is 59%, calculated from $5.30 in dividends against $8.96 in earnings per share, which is slightly above the 50% threshold that may indicate caution [3] - The decline in earnings is a critical factor to monitor, suggesting that investors should be cautious about chasing yield with Hershey or similar stocks [3]

Core Viewpoint - The Hershey Company is facing challenges due to rising cocoa prices and reduced consumer spending, leading to a decline in revenue and net income, but its low P/E ratio and strong dividend yield may present a buying opportunity for income-focused investors [1][2][3][4][6]. Company Performance - Hershey's revenue for the first half of 2024 was $5.3 billion, a decrease of 3% year-over-year, with a significant 17% drop in sales during the second quarter [2]. - The net income for the first two quarters of 2024 was $978 million, down 2% from the previous year [2]. - The company forecasts a 2% yearly reduction in net sales growth and a decline of 1% to 3% in earnings-per-share growth for 2024 [3]. Valuation Metrics - Hershey's stock is currently trading at a P/E ratio of 22, which is below the five-year average of 26, indicating potential for price appreciation as business conditions improve [4]. - The stock has only decreased by 7% over the past year, despite underperforming the S&P 500 over the last five years [3][4]. Dividend Analysis - Hershey has a consistent dividend payout of $5.48 per share annually, resulting in a dividend yield of nearly 2.8%, which is more than double the S&P 500 average of 1.3% [4]. - The company's free cash flow was approximately $551 million, covering the $544 million in dividend costs, while in 2023, free cash flow of around $1.55 billion covered $889 million in dividend costs, indicating sustainability of the dividend [5]. Investment Considerations - The recent slowdown in performance is likely temporary, and the lower P/E ratio may represent a buying opportunity for income-focused investors [6][7]. - Hershey operates in a competitive chocolate industry, relying heavily on its brand strength to maintain and grow sales, with limited expansion opportunities [7].

Core Insights - The Hershey Company has appointed Michael Del Pozzo as President of U.S. Confection, effective September 16, 2024, to lead the company's growth in the U.S. market [1][2] - Del Pozzo has extensive experience from his 23 years at PepsiCo, where he managed a $10 billion business and transformed Gatorade into a portfolio of sports and fitness brands [1][2] - He will work closely with other business unit leaders to advance Hershey's strategic goals and consumer needs [2] Company Overview - The Hershey Company is a leading snacks company with over 20,000 employees globally and more than 90 brand names, generating over $11.2 billion in annual revenues [3] - Iconic brands include Hershey's, Reese's, Kisses, Kit Kat®, Jolly Rancher, Twizzlers, and salty snacks like SkinnyPop and Pirate's Booty [3] - Hershey has a long-standing commitment to ethical and sustainable operations, with a focus on education and community support since its founding [3]

Core Viewpoint - The U.S. sugar consumption is high, leading to significant profits for companies producing sugary products, making sugar stocks attractive for passive income generation [1][7] Group 1: Coca-Cola - Coca-Cola has a strong dividend history, marking its 62nd consecutive annual dividend increase with a 5.4% raise, maintaining its status as a Dividend King [2][3] - The company paid $8 billion in dividends last year, totaling $84.7 billion since January 2010, with a current dividend yield of approximately 2.7%, more than double the S&P 500's yield [2] - Coca-Cola aims for 4% to 6% annual revenue growth and 7% to 9% earnings-per-share growth, supported by robust free cash flow of $9.2 billion expected in 2024 [3] Group 2: Hershey - Hershey has a solid dividend track record, increasing its payout for 15 consecutive years, including a 15% raise this year, with a current yield of 2.8% [4] - The company generated over $5 billion in sales in the first half of the year, with nearly $1 billion in income, driven by popular brands like Reese's and KitKat [4] - Hershey targets 2% to 4% annual net sales growth and 6% to 8% adjusted earnings-per-share growth, planning to align dividend increases with earnings growth [4] Group 3: Mondelez - Mondelez has increased dividends for 12 years, with an 11% raise in June and consistent double-digit growth in dividend-per-share over the last five years, currently yielding around 2.6% [5] - The company caters to a large snacking market, with 88% of consumers snacking daily, and owns popular brands like Oreo and Cadbury [5] - Mondelez aims for 3% to 5% annual revenue growth, targeting high single-digit earnings-per-share growth and over $3 billion in annual free cash flow for acquisitions and dividends [6]