Hershey Co

HSY

Sugar & Confectionery Products

Mkt Cap

$40.39B

PE

19.49

Debt

$5.385B

Cash

$520.4M

EV

$45.25B

FCF

$1.329B

Market Cap

$40.39B

P/E Ratio

19.49

Debt

$5.385B

Cash

$520.4M

EV

$45.25B

FCF

$1.329B

Charts data: {"Earnings":[{"time":"2014-12-30","value":846912000},{"time":"2015-12-30","value":512951000},{"time":"2016-12-30","value":720044000},{"time":"2017-12-30","value":756537000},{"time":"2018-12-30","value":1171051000},{"time":"2019-12-30","value":1146752000},{"time":"2020-12-30","value":1275413000},{"time":"2021-12-30","value":1477512000},{"time":"2022-12-30","value":1644817000},{"time":"2023-12-30","value":1861787000}],"Sales":[{"time":"2014-12-30","value":7421768000},{"time":"2015-12-30","value":7386626000},{"time":"2016-12-30","value":7440181000},{"time":"2017-12-30","value":7515426000},{"time":"2018-12-30","value":7791069000},{"time":"2019-12-30","value":7986252000},{"time":"2020-12-30","value":8149719000},{"time":"2021-12-30","value":8971337000},{"time":"2022-12-30","value":10419294000},{"time":"2023-12-30","value":11164992000}],"Net Margins":[{"time":"2014-12-30","value":0.11411189355420434},{"time":"2015-12-30","value":0.06944320722343326},{"time":"2016-12-30","value":0.09677775312186626},{"time":"2017-12-30","value":0.10066455314708707},{"time":"2018-12-30","value":0.1503068449271852},{"time":"2019-12-30","value":0.14359076072230129},{"time":"2020-12-30","value":0.15649778845135642},{"time":"2021-12-30","value":0.1646925090429665},{"time":"2022-12-30","value":0.15786261525972872},{"time":"2023-12-30","value":0.16675220188245546}],"Assets":[{"time":"2014-12-30","value":5629516000},{"time":"2015-12-30","value":5344371000},{"time":"2016-12-30","value":5524333000},{"time":"2017-12-30","value":5553726000},{"time":"2018-12-30","value":7703020000},{"time":"2019-12-30","value":8140395000},{"time":"2020-12-30","value":9131845000},{"time":"2021-12-30","value":10412231000},{"time":"2022-12-30","value":10948820000},{"time":"2023-12-30","value":11902941000}],"Stockholders Equity":[{"time":"2014-12-30","value":1519530000},{"time":"2015-12-30","value":1047462000},{"time":"2016-12-30","value":827687000},{"time":"2017-12-30","value":931565000},{"time":"2018-12-30","value":1407266000},{"time":"2019-12-30","value":1744994000},{"time":"2020-12-30","value":2237883000},{"time":"2021-12-30","value":2757229000},{"time":"2022-12-30","value":3299544000},{"time":"2023-12-30","value":4099086000}],"ROE":[{"time":"2014-12-30","value":0.5573512862529861},{"time":"2015-12-30","value":0.48970845720417544},{"time":"2016-12-30","value":0.8699472143455195},{"time":"2017-12-30","value":0.8121140231760532},{"time":"2018-12-30","value":0.8321461614222186},{"time":"2019-12-30","value":0.6571667295131101},{"time":"2020-12-30","value":0.5699194283168513},{"time":"2021-12-30","value":0.5358684389290842},{"time":"2022-12-30","value":0.49849827733771696},{"time":"2023-12-30","value":0.4541956426383833}],"ROA":[{"time":"2014-12-30","value":0.3474918625331201},{"time":"2015-12-30","value":0.19417794909821942},{"time":"2016-12-30","value":0.21826761710418252},{"time":"2017-12-30","value":0.22951096255018702},{"time":"2018-12-30","value":0.21078278389514762},{"time":"2019-12-30","value":0.19605338561580857},{"time":"2020-12-30","value":0.19521772434814652},{"time":"2021-12-30","value":0.1962808931150298},{"time":"2022-12-30","value":0.20648681775753003},{"time":"2023-12-30","value":0.2151457358311698}]}

The Hershey Company, together with its subsidiaries, engages in the manufacture and sale of confectionery products and pantry items in the United States and internationally. The company operates through three segments: North America Confectionery, North America Salty Snacks, and International. It offers chocolate and non-chocolate confectionery products; gum and mint refreshment products, including mints, chewing gums, and bubble gums; pantry items, such as baking ingredients, toppings, beverages, and sundae syrups; and snack items comprising spreads, bars, snack bites, mixes, popcorn, and pretzels. The company provides its products primarily under the Hershey's, Reese's, Kisses, Jolly Rancher, Almond Joy, Brookside, barkTHINS, Cadbury, Good & Plenty, Heath, Kit Kat, Payday, Rolo, Twizzlers, Whoppers, York, Ice Breakers, Breath Savers, Bubble Yum, Lily's, SkinnyPop, Pirates Booty, Paqui, Dot's Homestyle Pretzels, and ONE Bar brands, as well as under the Pelon Pelo Rico, IO-IO, and Sofit brands. It markets and sells its products to wholesale distributors, chain grocery stores, mass merchandisers, chain drug stores, vending companies, wholesale clubs, convenience stores, dollar stores, concessionaires, and department stores. The company was founded in 1894 and is headquartered in Hershey, Pennsylvania.

Sector

JBSS

10-Q
10/1/23
10-Q
7/2/23
10-Q
4/2/23
10-K
12/31/22
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10/2/22
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7/3/22
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4/3/22
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12/31/21
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12/31/20
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12/31/19
10-Q
9/29/19
10-Q
6/30/19
10-Q
3/31/19
10-K
12/31/18
10-Q
9/30/18
10-Q
7/1/18
10-Q
4/1/18
10-K
12/31/17

DCF

Discounted Cash Flow Valuation of Hershey Co

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

Multiple

g\r	+10%	+11%	+12%	+13%	+14%
0%	10	9	8	8	7
+1%	11	10	9	8	8
+2%	13	11	10	9	8
+3%	14	13	11	10	9
+4%	17	14	12	11	10

Years	0	1	2	3	4	5	6	7	8	9	10	TV
FCF	$1.329B	$1.477B	$1.632B	$1.792B	$1.956B	$2.121B	$2.285B	$2.447B	$2.603B	$2.751B	$2.888B	$28.88B
DCF		$1.285B	$1.234B	$1.179B	$1.118B	$1.055B	$988.1M	$919.9M	$850.9M	$782M	$714M	$7.14B
Value	$17.26B

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth 16%

Earnings Stability 92%

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

The Net Margin is high enough to offer a good protection on the profits in case of higher costs or higher interests. Furthermore higher margins reduce earnings’ volatility.

Over time the ROA has been increasing indicating a higher marginal ROA with respect to the calculated one, giving a good sign for continued growth.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Net Margin	6.9%	9.7%	10%	15%	14%	16%	16%	16%	17%	18%
ROA	19%	22%	23%	21%	20%	20%	20%	21%	22%	23%
ROE	49%	87%	81%	83%	66%	57%	54%	50%	45%	50%

What is the average Net Margin?

The average Net Margin over the past 5 years is +15.66%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is +0.38%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +20.33%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is +0.15%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is +59.13%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is -6.86%.

Safety & Stabiliy

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

The company has high debt with respect to the cashflow it generates.

The Graham’s stability indicate reliability of earnings, and consideration about the future are more dependable.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Debt FCF	2.89	4.17	2.94	3.51	3.42	3.95	3.17	2.68	3.10	4.05
Debt Equity	2.44	3.60	3.14	3.17	2.83	2.22	1.82	1.47	1.17	1.31
MIN
Graham Stability	-	-	100%	100%	100%	100%	100%	100%	100%	100%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 4.05.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is -0.14.

What is the Graham’s Stability?

Graham’s Stability measure stands at 1.00.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Earnings growth has been increasing in past years.

Years	12-2016	12-2018	12-2020	12-2022	Trend
Revenue	6%	7.5%	11%	7.2%	1.6%
Net Income	15%	9.7%	13%	13%	1.7%
Stockholders Equity	26%	24%	22%	24%	5.7%
FCF	12%	4.1%	7.3%	-14%	-5.7%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +7.46%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +1.55%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is +9.72%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is +1.69%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +23.84%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is +5.69%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is +4.07%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is -5.71%.