On Tuesday, Barclays made an adjustment to its outlook on shares of Hershey (NYSE:HSY), reducing the price target to $202 from $204, while retaining an Equalweight rating. The adjustment comes in response to observed weaker consumption and share trends during the majority of the third quarter of 2024.
The firm noted that 2024 was expected to be a year where growth would be more pronounced in the latter half, with organic sales and earnings per share (EPS) set to increase as the year progresses. However, the current trends have not met these expectations, prompting Barclays to revise their estimates for the quarter and the full year to figures that fall below the consensus provided by Consensus Metrix.
This revision reflects a cautious stance on Hershey's near-term performance, as the company navigates through the third quarter. The new price target of $202 suggests Barclays sees limited upside to the stock from its previous target but maintains a neutral stance on the company's shares.
Hershey will continue to be monitored by investors and analysts alike as the company approaches the end of the third quarter and provides more insight into its performance. The market will be looking to see if Hershey can adjust and meet the challenges of the current business environment as the year continues to unfold.
In other recent news, there have been notable developments concerning The Hershey Company (NYSE:HSY). The company reported its second quarter 2024 earnings, outlining a pricing strategy to counterbalance cocoa price volatility.
Hershey plans a 6-7% price increase and has secured cocoa prices for 2024. Despite minor adjustments to its full-year guidance, the company anticipates a stronger second half of the year, driven by innovation and merchandising improvements.
Simultaneously, Hershey has seen significant changes in its management with the appointment of Michael Del Pozzo as the new President of its U.S. Confection segment. Del Pozzo, with a wealth of experience from PepsiCo (NASDAQ:PEP), is expected to drive Hershey's growth initiatives within the United States.
In the realm of financial analysis, several firms have revised their ratings and price targets for Hershey. Piper Sandler maintained a Neutral stance, adjusting its earnings per share (EPS) estimate for 2024 from $9.45 to $9.35, citing concerns over cocoa cost pressures and slower-than-anticipated momentum in confectionery sales.
Citi downgraded Hershey's stock from Neutral to Sell due to concerns over the company's gross margin in the coming year. Additionally, Goldman Sachs initiated coverage on Hershey with a Sell rating, citing potential downward estimate revisions due to ongoing losses in market share.
As part of recent developments, Hershey is also planning a significant workforce reduction, aligning with a broader trend of layoffs across various sectors. These are recent developments concerning Hershey.
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