Hershey (HSY) Stock Forecast & Price Target

Hershey's strong market position is evident, as it holds approximately 36% of the domestic chocolate market and has seen a 6% increase in confectionery sales, buoyed by a 2% rise in volume due to additional shipping days and seasonal strength. The company's recent expansion into the North America Salty Snacks segment, with organic sales increasing by 36%, reflects successful strategic initiatives and solid performance from brands like Skinny Pop and Dot’s Pretzels. Additionally, the growth in seasonal sales during key periods, with Halloween and Holiday segments growing by 7.6% and 3.3% year-over-year respectively, highlights Hershey's ability to effectively capture consumer interest and maintain its competitive edge.

Hershey's financial outlook for FY25 indicates significant challenges, with an estimated decline in earnings per share (EPS) of nearly 35%, forecasted to reach $6.13. The company's guidance anticipates at least 2% sales growth, yet this is overshadowed by substantial inflation pressures, rebased incentive compensation, and an increased tax rate that are expected to negatively impact profitability. Additionally, the salty snack segment has underperformed, with expectations of a 14% decline in organic sales, exacerbated by adverse inventory dynamics and softer market conditions, contributing further to the negative outlook on the company's financial performance.