Hershey (HSY) closed at $185.26 in the latest trading session, marking a -2.95% move from the prior day. The stock fell short of the S&P 500, which registered a loss of 0.5% for the day. On the other hand, the Dow registered a loss of 0.38%, and the technology-centric Nasdaq decreased by 0.5%.
Coming into today, shares of the chocolate bar and candy maker had gained 5.08% in the past month. In that same time, the Consumer Staples sector lost 3.92%, while the S&P 500 gained 2.74%.
Market participants will be closely following the financial results of Hershey in its upcoming release. In that report, analysts expect Hershey to post earnings of $1.06 per share. This would mark a year-over-year decline of 54.7%. Alongside, our most recent consensus estimate is anticipating revenue of $3.11 billion, indicating a 4.1% upward movement from the same quarter last year.
HSY's full-year Zacks Consensus Estimates are calling for earnings of $5.92 per share and revenue of $11.51 billion. These results would represent year-over-year changes of -36.82% and +2.78%, respectively.
Investors should also pay attention to any latest changes in analyst estimates for Hershey. Recent revisions tend to reflect the latest near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.24% higher. Right now, Hershey possesses a Zacks Rank of #3 (Hold).
In terms of valuation, Hershey is presently being traded at a Forward P/E ratio of 32.24. Its industry sports an average Forward P/E of 22.27, so one might conclude that Hershey is trading at a premium comparatively.
One should further note that HSY currently holds a PEG ratio of 4.61. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. Food – Confectionery stocks are, on average, holding a PEG ratio of 3.55 based on yesterday's closing prices.
