Core Viewpoint - Momentum investing focuses on following a stock's recent price trends, with the aim of buying high and selling higher, capitalizing on established price movements [1]. Company Overview: Hershey (HSY) - Hershey currently holds a Momentum Style Score of B, indicating a favorable momentum characteristic [2]. - The company has a Zacks Rank of 2 (Buy), suggesting strong potential for outperformance in the market [3]. Performance Metrics - Over the past week, Hershey's shares increased by 1.86%, outperforming the Zacks Food - Confectionery industry, which rose by 0.44% [5]. - In a longer timeframe, Hershey's shares have appreciated by 14.28% over the past month, compared to the industry's 4.21% [5]. - Over the last quarter, Hershey's shares have risen by 15.44%, and over the past year, they have gained 41.03%, while the S&P 500 only increased by 1.9% and 15.32%, respectively [6]. Trading Volume - Hershey's average 20-day trading volume is 1,851,394 shares, which serves as a bullish indicator when combined with rising stock prices [7]. Earnings Outlook - In the past two months, 5 earnings estimates for Hershey have been revised upwards, while none have been lowered, leading to an increase in the consensus estimate from $5.99 to $6.01 [9]. - For the next fiscal year, 7 estimates have also moved higher, with no downward revisions during the same period [9]. Conclusion - Given the positive momentum indicators and earnings outlook, Hershey is positioned as a 2 (Buy) stock with a Momentum Score of B, making it a strong candidate for near-term investment [10].

About this content About Angela Harmantas Angela Harmantas is an Editor at Proactive. She has over 15 years of experience covering the equity markets in North America, with a particular focus on junior resource stocks. Angela has reported from numerous countries around the world, including Canada, the US, Australia, Brazil, Ghana, and South Africa for leading trade publications. Previously, she worked in investor relations and led the foreign direct investment program in Canada for the Swedish government ...

Core Insights - The Hershey Company reported fourth-quarter 2025 results with both revenue and earnings exceeding Zacks Consensus Estimates, although adjusted earnings per share fell 36.4% year over year [1][10] - The company provided an initial outlook for 2026, expecting sales growth of 4-5% and earnings growth of 30-35% [13][14] Financial Performance - Consolidated net sales reached $3,091 million, a 7% increase from the previous year, surpassing the Zacks Consensus Estimate of $3,002 million [2] - Adjusted earnings were $1.71 per share, exceeding the consensus estimate of $1.40 [1] - Adjusted operating income declined 24% to $529.3 million, with an adjusted operating margin of 17.1%, down 700 basis points year over year [6] Sales Breakdown - North America Confectionery segment net sales were $2.48 billion, up 5.3% year over year, driven by pricing actions despite a decline in volume [7] - The North America Salty Snacks segment saw net sales of $357 million, representing a 28% year-over-year growth, aided by the LesserEvil acquisition [9] - International segment net sales were $255.6 million, a slight increase of 0.4% year over year, but reported a loss of $31.6 million compared to a profit in the prior year [11] Margin and Cost Analysis - Adjusted gross margin was 38.3%, down 650 basis points year over year due to increased cocoa and input costs, tariff expenses of approximately $30 million, and lower volumes [4] - Selling, marketing, and administrative expenses rose 12.1% year over year, driven by higher compensation and brand investment [5] Future Outlook - For 2026, Hershey anticipates net sales growth of 4-5%, with contributions from pricing actions and innovation [13] - Expected adjusted diluted earnings per share for 2026 are projected to be between $8.20 and $8.52, indicating significant growth [14] - Capital expenditures for 2026 are estimated to be between $425 million and $475 million [14]

For the quarter ended December 2025, Hershey (HSY) reported revenue of $3.09 billion, up 7.1% over the same period last year. EPS came in at $1.71, compared to $2.69 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $3 billion, representing a surprise of +2.98%. The company delivered an EPS surprise of +21.74%, with the consensus EPS estimate being $1.41.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expecta ...

Financial Data and Key Metrics Changes - The company anticipates 4%-5% net sales growth and meaningful earnings recovery for 2026, indicating a positive outlook following a challenging 2025 [4] - The gross margin is expected to recover to 41% in 2026, which is an improvement from 2025 but still below historical levels [24][26] Business Line Data and Key Metrics Changes - The snacks business experienced an 18% growth in Q4, driven by double-digit volume growth, showcasing strong performance in this segment [12][47] - Organic sales growth for the confection segment is around 3%, while salty snacks are expected to grow in the mid-single digits [99] Market Data and Key Metrics Changes - The company is gaining market share in key international markets such as Canada, Mexico, Brazil, and the UK, indicating a strong international growth potential [102] - The company has factored in the impact of SNAP waivers into its outlook, with only 2 states currently implementing these waivers for candy [88] Company Strategy and Development Direction - The company is focused on investing in innovation, brand building, and execution to drive growth, with a significant increase in advertising planned for 2026 [29][30] - The strategy includes a balanced approach to growth and margin recovery, with multi-year investments aimed at sustaining long-term top-line growth [30][63] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of their portfolio despite headwinds like cocoa inflation and macro volatility [4] - The company is optimistic about the cocoa market, anticipating a larger supply surplus in 2025 and 2026, which could lead to further deflation in cocoa prices [26][60] Other Important Information - The company plans to connect its brands to cultural moments throughout the year, enhancing consumer engagement and driving sales [90] - The management highlighted the importance of maintaining a rational pricing strategy in the category, with expectations for continued promotional activities [95] Q&A Session Summary Question: Concerns about potential price deflation due to cocoa price decline - Management acknowledged the sophisticated nature of competitors and emphasized their patient approach to pricing, ensuring affordability while navigating cocoa cost inflation [9][10] Question: Elasticity and its impact on pricing strategy - Management noted that current elasticities are favorable, and they are planning for around 0.8 to account for fluctuations, with a goal to exceed this [19] Question: Insights on cocoa's impact on margins - Management indicated that while cocoa prices have declined, they expect to see a recovery in gross margins, but volatility remains a concern [24][26] Question: Plans for brand investment and its durability - Management stated that investments in 2026 are designed to lay a foundation for future growth, with a focus on demand creation and innovation [30] Question: Performance in international markets - Management expressed optimism about international growth, highlighting market share gains and a focused strategy for key markets [102] Question: Impact of SNAP changes on business - Management described SNAP changes as a manageable headwind, with ongoing monitoring and strategies in place to adapt [88] Question: Expectations for earnings growth and flexibility in guidance - Management emphasized the momentum in the business and the flexibility built into their guidance to respond to changing conditions [46][49]

Financial Data and Key Metrics Changes - The company anticipates 4%-5% net sales growth and meaningful earnings recovery for 2026, indicating a positive outlook after navigating challenges in 2025 [7] - The pricing taken in 2025 does not fully cover cocoa cost inflation for 2026, suggesting a recovery path while investing in marketing and innovation [12][13] - Gross margins are expected to recover to 41% in 2026, which is an improvement from 2025 but still below historical levels [28] Business Line Data and Key Metrics Changes - The snacks business experienced an 18% growth in Q4, driven by double-digit volume growth, indicating strong performance in this segment [15] - The confection segment is projected to have organic sales growth around 3%, while salty snacks are expected to grow in the mid-single digits [102] Market Data and Key Metrics Changes - The company is gaining market share in key international markets such as Canada, Mexico, Brazil, and the U.K., reflecting a positive trend in its international business [105] - The salty category was relatively flat last year, but the company achieved double-digit growth, indicating strong performance against market trends [55] Company Strategy and Development Direction - The company is focused on brand building and innovation, with significant investments planned for 2026, including a double-digit increase in advertising [31][34] - The strategy includes leveraging cultural moments and seasonal events to enhance brand engagement and drive sales [94] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the portfolio and the ability to navigate macroeconomic challenges, including cocoa inflation [7] - The company is monitoring changes in SNAP regulations but views them as a manageable headwind [92] Other Important Information - The company plans to provide more detailed insights into its long-term strategy and investments during the upcoming investor day [66] - The management emphasized the importance of balancing growth and margin recovery in their investment strategy [63] Q&A Session Summary Question: Concerns about potential price deflation due to cocoa price changes - Management acknowledged the risk but emphasized their strategic pricing approach and consumer insights [12][19] Question: Elasticity and its impact on pricing strategy - Management noted that current elasticities are favorable and are planning for flexibility in their pricing strategy [21][22] Question: Cocoa's impact on margin framework - Management indicated optimism about cocoa prices stabilizing and potential for margin recovery in 2027 [30] Question: Brand investment durability and future reinvestment - Management stated that investments in 2026 are designed to support long-term growth and will continue into 2027 [32] Question: Gross margin performance in Q4 - Management highlighted strong volume growth and lower-than-expected tariffs as key contributors to improved gross margins [40][41] Question: International segment performance and pricing actions - Management discussed the challenges and strategies in the international market, focusing on premium pricing and market share gains [104][105] Question: SNAP program changes and their impact - Management provided insights on the early assessment of SNAP changes and their manageable impact on the business [91][92] Question: Cultural and seasonal events to boost engagement - Management emphasized the importance of connecting brands to cultural moments to enhance consumer engagement [94][95] Question: Balancing promotions and marketing investments - Management indicated a rational approach to pricing and promotions while maintaining strong brand investments [98][100]

Financial Data and Key Metrics Changes - The company anticipates 4%-5% net sales growth and meaningful earnings recovery for 2026, indicating a positive outlook after navigating challenges in 2025 [4][10] - The gross margin is expected to recover to 41% in 2026, which is an improvement from 2025 but still below historical levels [25][27] Business Line Data and Key Metrics Changes - The snacks business experienced an 18% growth in Q4 2025, driven by double-digit volume growth [12][46] - The confection segment is projected to have organic sales growth around 3%, while salty snacks are expected to grow in the mid-single digits [98] Market Data and Key Metrics Changes - The company is seeing strong performance in its salty snacks category, which has been a significant growth driver, contrasting with a relatively flat performance in the overall salty category last year [52][79] - The international market is expected to see low single-digit sales growth, with a focus on premium products and strategic pricing [100][101] Company Strategy and Development Direction - The company is focusing on multi-year investments in brand building, innovation, and R&D to drive sustainable growth [30][62] - There is a strong emphasis on connecting brands to cultural moments and seasonal events to enhance consumer engagement and drive sales [90][91] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the portfolio and the ability to navigate macroeconomic challenges, including cocoa inflation [4][10] - The company is monitoring external factors such as SNAP changes and macroeconomic headwinds, but remains optimistic about growth opportunities [88][106] Other Important Information - The company plans to provide more detailed insights into its strategy and investments during the upcoming investor day [62][110] - The management highlighted the importance of maintaining a rational pricing strategy while leveraging promotions to drive consumer excitement [95][97] Q&A Session Summary Question: Cocoa pricing and potential deflation - Management acknowledged the potential for price deflation due to recent cocoa price declines but emphasized their strategic approach to pricing and consumer insights [9][10] Question: Elasticity and flexibility in planning - Management noted that while current elasticities are favorable, they are planning for fluctuations and have built flexibility into their guidance [20][21] Question: Gross margin performance in Q4 - Management indicated that the gross margin exceeded expectations due to strong volume leverage and lower-than-anticipated tariffs on supplier materials [36][38] Question: Brand investment durability - Management stated that the brand investments made in 2026 are expected to lay a foundation for growth in 2027 and beyond [30][31] Question: International market performance - Management expressed optimism about international growth, highlighting share gains in key markets like Canada and Mexico [101][102] Question: SNAP program changes - Management provided insights on the impact of SNAP changes, indicating it is a manageable headwind and factored into their outlook [88][89] Question: Future earnings expectations - Management discussed the potential for earnings growth in 2027, emphasizing the importance of balancing investments with margin recovery [59][60]

Core Insights - Hershey forecasts annual sales and profit above Wall Street estimates, driven by strong demand for confectionery and salty snacks, along with benefits from previous price increases [1] Group 1: Financial Performance - The company anticipates higher annual sales and profit figures compared to Wall Street expectations [1] - Resilient demand for its products is a key factor in this positive outlook [1] Group 2: Market Dynamics - Continued benefits from earlier price hikes are contributing to the company's financial performance [1] - The strong performance in both confectionery and salty snacks indicates a robust market position [1]

分组1 - Hershey reported quarterly earnings of $1.71 per share, exceeding the Zacks Consensus Estimate of $1.41 per share, but down from $2.69 per share a year ago, resulting in an earnings surprise of +21.74% [1] - The company achieved revenues of $3.09 billion for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 2.98%, and up from $2.89 billion year-over-year [2] - Hershey has consistently surpassed consensus EPS estimates over the last four quarters, achieving this four times [2] 分组2 - The stock has gained approximately 13.1% since the beginning of the year, significantly outperforming the S&P 500, which gained 0.5% [3] - The current consensus EPS estimate for the upcoming quarter is $1.93 on revenues of $3 billion, and for the current fiscal year, it is $7.06 on revenues of $12.02 billion [7] - The Food - Confectionery industry, to which Hershey belongs, is currently ranked in the top 2% of over 250 Zacks industries, indicating a favorable outlook for the sector [8]

Financial Data and Key Metrics Changes - Total Hershey net sales increased by 7% in Q4 2025, with full-year growth of 4.4% [4][13] - Consolidated net sales for 2025 reached approximately $11.7 billion, reflecting a 4.4% increase year-over-year [13] - Adjusted gross margin for Q4 was 38.3%, a decrease of 650 basis points compared to the previous year due to commodity inflation and tariff expenses [16] Business Line Data and Key Metrics Changes - North America Confectionery net sales increased by 5.3% in Q4, with net price realization contributing approximately 10 points to growth [14] - North America Salty Snacks segment net sales surged by 28% in Q4, with organic constant currency growth of 18.2% [14] - The international segment saw a slight increase in net sales by 0.4% to $256 million, but organic constant currency net sales declined by 1.9% [15] Market Data and Key Metrics Changes - U.S. confection retail sales growth was in line with the category in Q4, driven by strong innovation and holiday programming [4] - The U.S. salty snacking business experienced a retail sales growth of 15.6% in Q4, leading to an 11.3% increase for the full year [5] - Hershey's international segment achieved full-year organic constant currency net sales growth of 2.2%, with market share gains in Mexico, Brazil, and the U.K. [6] Company Strategy and Development Direction - The company aims to accelerate sustainable sales growth, restore margins, and position Hershey for long-term success [3] - Strategic priorities for 2026 include delivering top-line growth, driving sustainable margin improvement, and evolving the strategy for future competitiveness [8][12] - The company plans to introduce innovative products and increase media investments to support brand growth [10][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating a challenging environment marked by cocoa inflation and macroeconomic volatility [3] - The outlook for 2026 includes expected net sales growth of 4% to 5%, with a focus on innovation and brand investment [19] - Management is cautious about potential demand headwinds, including health trends and consumer financial pressures [20] Other Important Information - The AAA Program has generated over $300 million in net savings over the past two years, with an additional $100 million projected for 2026 [7] - The acquisition of LesserEvil is expected to contribute approximately 150 basis points to growth in 2026 [19] - Capital expenditures for 2026 are projected to be between $425 million and $475 million, focusing on technology investments [23] Q&A Session Summary Question: What are the expectations for 2026 sales growth? - The company expects full-year 2026 total net sales growth of between 4% and 5%, driven by pricing, innovation, and brand investment [19] Question: How will the company address margin recovery? - The company anticipates a gross margin recovery of around 400 basis points in 2026, supported by pricing and productivity initiatives [20] Question: What are the plans for capital allocation in 2026? - The company will prioritize reinvestment in the business, including M&A, and plans to raise dividends by 6% [23]