Hershey (HSY) Stock Forecast & Price Target

Hershey's demonstrates a robust financial outlook, highlighted by an anticipated pricing increase of 5%-6% for FY25, reflecting a strong demand for its products. In the third quarter, organic sales rose by 6%, with the everyday business segment gaining market share driven by a notable 12% increase in retail sales over the most recent four weeks. Furthermore, the company's strategic expansion into salty snacks and international markets showcases its versatility, as organic sales grew by 10% in North American salty snacks and 12% internationally.

Hershey's operating profit has experienced a substantial decline of 35%, driven by increased gross margin pressures and higher incentive compensation, resulting in an operating margin contraction of 860 basis points to 13.3%. The company has revised its sales growth expectations down to 3% from a previous estimate of 2%, while earnings per share (EPS) is projected to decline by 36.5% to approximately $5.95, reflecting an adjusted forecast that indicates deeper declines in the fourth quarter performance. Moreover, Hershey anticipates a significant gross margin decline—estimated at 900 basis points for the fourth quarter—due to rising cocoa costs and tariff expenses, compounding the overall negative outlook for the firm's financial health.