Hershey (HSY) Stock Forecast & Price Target

Hershey's financial outlook appears positive, driven by a projected pricing increase of 5%-6% for FY25, signaling confidence in the company's pricing power. The third quarter demonstrated robust performance, with organic sales rising by 6% and the everyday business gaining market share, particularly as retail sales for this segment increased by 12% in the most recent four weeks. Additionally, through strategic acquisitions and a diversified portfolio, Hershey has effectively expanded its footprint beyond traditional confectionery, contributing to organic sales growth across multiple divisions, including a notable 12% increase in international sales.

Hershey's has reported a significant decline in operating profit, falling 35% alongside an operating margin contraction of 860 basis points to 13.3%, primarily due to adverse impacts on gross margin and increased incentive compensation. The company anticipates a further decline in operating profit of nearly 39.5% in the fourth quarter of 2025, with an expected gross margin drop exceeding the previous quarter's performance and a full-year gross margin decline projected at 680 basis points. Additionally, the firm has revised its sales growth expectations downward to 3% and revised its earnings per share forecast downward, now anticipating a steep decline of 36.5% for FY25, reflecting ongoing pressures from rising cocoa costs and tariff expenses.