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Hershey (HSY) Outpaces Stock Market Gains: What You Should Know

In the latest trading session, Hershey (HSY) closed at $255.12, marking a +0.76% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.62%. Meanwhile, the Dow gained 0.5%, and the Nasdaq, a tech-heavy index, lost 5.66%.

Heading into today, shares of the chocolate bar and candy maker had lost 7.63% over the past month, lagging the Consumer Staples sector's loss of 5.35% and the S&P 500's gain of 3.44% in that time.

Investors will be hoping for strength from Hershey as it approaches its next earnings release. On that day, Hershey is projected to report earnings of $1.90 per share, which would represent year-over-year growth of 5.56%. Meanwhile, our latest consensus estimate is calling for revenue of $2.53 billion, up 6.78% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $9.49 per share and revenue of $11.29 billion. These totals would mark changes of +11.38% and +8.4%, respectively, from last year.

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It is also important to note the recent changes to analyst estimates for Hershey. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.04% lower. Hershey currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Hershey has a Forward P/E ratio of 26.67 right now. For comparison, its industry has an average Forward P/E of 23.5, which means Hershey is trading at a premium to the group.

It is also worth noting that HSY currently has a PEG ratio of 3.48. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Food - Confectionery stocks are, on average, holding a PEG ratio of 3.48 based on yesterday's closing prices.

The Food - Confectionery industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 113, which puts it in the top 45% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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Hershey Company (The) (HSY) : Free Stock Analysis Report

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