The Hershey Company


SKU: HSY-1 Category:


The Hershey Co had a robust Q1 2021 where the company managed to report a double-digit top-line growth and its fourth-in-a-row earnings surprise. The management was able to generate an excellent marketing yield-per-dollar spent as its 12.9% jump in revenues came with a mere 2.8% increase in advertising and related consumer marketing expenses. Like most other food companies, Hershey also suffered from higher direct costs and its gross margin contracted by 80 bps in the quarter. However, its supply chain strength ad the improved advertising yield helped the company deliver a good quarter despite many key brand divestments such as Kraveas, Scharffen Berger, and Dagoba. The management has provided a decent guidance for 2021 with an expected growth of between 4 and 6% for the entire year and is expected to gain from its major initiative titled Supply Chain 2.0 helping them to meet the consumer demand in the changing retail environment with an increased shift towards e-commerce purchasing. We believe the stock is a ‘Hold’ at current levels.

Our Report Structure:

⦁ Company Overview
⦁ Investment Thesis
⦁ Key Drivers
⦁ Historical Quarterly Statement Analysis – Income Statement & Cash Flows
⦁ Historical Quarterly Balance Sheet Analysis
⦁ Historical Annual Financial Statement Analysis
⦁ Analysis Of Key Financial Ratios
⦁ Financial Forecasts For 3 Years
⦁ Forecasting The Capital Structure & Net Debt
⦁ Discounted Cash Flow Valuation
⦁ Trading Multiples
⦁ Key Risks
⦁ Disclosures

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