- The Hershey Company recently reported its second-quarter 2025 earnings, highlighting year-over-year sales growth to US$2.61 billion but a sharp decline in net income to US$62.72 million, alongside a lowered earnings outlook reflecting expanding tariff-related costs.
- The company also unveiled a high-profile collaboration between REESE'S and OREO, introducing new permanent products that further diversify its snack portfolio, while confirming its 382nd consecutive common stock dividend and appointing a new board member with extensive marketing expertise.
- We will explore how Hershey’s lower earnings guidance and higher tariff expenses influence expectations for its growth and profitability.
Find companies with promising cash flow potential yet trading below their fair value.
Hershey Investment Narrative Recap
To be a Hershey shareholder, you need to believe that the company's brand strength, innovation pipeline, and diversified snacking portfolio can offset margin pressures and industry headwinds such as tariffs and high input costs. The latest earnings report and lowered guidance make it clear that expanding tariff expenses now stand as the key immediate risk to earnings, while new product launches remain a critical catalyst for future growth. These developments reinforce, rather than fundamentally shift, the balance of risks and opportunities in the short term.
Among the recent announcements, the introduction of the REESE'S and OREO collaboration speaks directly to Hershey’s reliance on innovation to drive volume and preserve pricing power. As tariff costs begin to weigh more heavily on profitability, the commercial success of such permanent product additions may become increasingly pivotal in supporting Hershey’s underlying growth thesis, particularly as consumer preferences continue to evolve.
However, in contrast to these potential growth drivers, investors should be aware of the unpredictable impact that further tariff escalations could have on Hershey’s...
Read the full narrative on Hershey (it's free!)
Hershey's narrative projects $12.2 billion revenue and $1.8 billion earnings by 2028. This requires 4.3% yearly revenue growth and a $0.2 billion earnings increase from $1.6 billion.
Uncover how Hershey's forecasts yield a $181.91 fair value, a 3% upside to its current price.
Exploring Other Perspectives
Simply Wall St Community members provided fair value estimates for Hershey stock ranging from US$137.74 to US$183.04, across nine distinct viewpoints. As tariff risks put pressure on profit margins, it is worth considering how each of these perspectives interprets the company's ability to weather cost increases and deliver long-term growth.
Explore 9 other fair value estimates on Hershey - why the stock might be worth 22% less than the current price!
Build Your Own Hershey Narrative
Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.
- A great starting point for your Hershey research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.
- Our free Hershey research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Hershey's overall financial health at a glance.
Looking For Alternative Opportunities?
The market won't wait. These fast-moving stocks are hot now. Grab the list before they run:
- The best AI stocks today may lie beyond giants like Nvidia and Microsoft. Find the next big opportunity with these 18 smaller AI-focused companies with strong growth potential through early-stage innovation in machine learning, automation, and data intelligence that could fund your retirement.
- Trump has pledged to "unleash" American oil and gas and these 22 US stocks have developments that are poised to benefit.
- The end of cancer? These 26 emerging AI stocks are developing tech that will allow early identification of life changing diseases like cancer and Alzheimer's.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com