Weighing Hershey (HSY) Valuation As Recent Share Price Momentum Meets Conflicting Fair Value Signals

Hershey stock snapshot after recent performance shift

Hershey (HSY) has quietly put in a strong stretch, with the share price up about 12% over the past month and roughly 22% in the past 3 months, drawing fresh attention from investors.

See our latest analysis for Hershey.

Set against a 1-year total shareholder return of 39.63% and a 5-year total shareholder return of 69.68%, the recent 21.73% year to date share price return suggests momentum has been building again despite some short term swings.

If Hershey’s run has you thinking about where else capital could work hard, it might be a good time to broaden your search with our 22 top founder-led companies.

With HSY trading at $222.04, sitting only about 3% below the average analyst price target yet around 26% below one intrinsic value estimate, you have to ask: is this a genuine entry point, or is future growth already priced in?

Most Popular Narrative: 14.2% Overvalued

Hershey’s most followed narrative pegs fair value at about $194.35, which sits below the recent $222.04 close and frames the current rally in a different light.

The analysts have a consensus price target of $166.87 for Hershey based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $211.0, and the most bearish reporting a price target of just $123.0.

Read the complete narrative.

Want to see what sits behind that gap between fair value and today’s price? The narrative leans on measured revenue growth, modest margin pressure, and a richer future earnings multiple that has to do a lot of heavy lifting. Curious how those ingredients combine into that fair value line in the sand?

Result: Fair Value of $194.35 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, there are still real pressure points, including high cocoa costs, tariff uncertainty and a weaker consumer that could challenge those margin and earnings assumptions.

Find out about the key risks to this Hershey narrative.

Another Take: Cash Flows Point in the Other Direction

While the popular narrative sees Hershey as about 14.2% overvalued at $222.04 versus a fair value of roughly $194.35, our DCF model presents a different view. In that scenario, HSY trading at $222.04 sits about 25.9% below an intrinsic value estimate of $299.73. This raises a simple question for you: is the market being too cautious about those future cash flows, or is the model leaning too hard on optimistic assumptions?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Hershey for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 53 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

The split views on Hershey in this article are clear. If you want to move quickly and form your own stance, it is worth weighing both the red flags and bright spots in 2 key rewards and 3 important warning signs.

Ready to hunt for your next idea?

If Hershey has you thinking more critically about price versus potential, do not stop here, your next strong idea could be sitting in our screener results right now.

• Target potential mispricings by scanning our list of 53 high quality undervalued stocks that pair solid fundamentals with more modest expectations.
• Secure your income angle by reviewing a focused set of 13 dividend fortresses built around higher yields and durability checks.
• Protect your downside first by filtering for 80 resilient stocks with low risk scores that score well on balance sheet strength and risk metrics.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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