HSY

HSY

Hershey Company (The)

Dividend / Cash flow

★ Quality 31/100
Overvalued

Price today

$173.15

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A monopoly position

This company has a competitive advantage so strong that its rivals find it practically impossible to replicate.

What this business is made of

31qualityReturnsMoatBalance sheetPricing powerReinvestment

The business

Hershey owns the chocolate your tongue reaches for without asking you.

Hershey makes and sells chocolate and candy in North America: Reese's, Hershey's, Kit Kat (licensed), Twizzlers. It sold $11.7B in 2025, almost all through supermarkets and convenience stores. It's also pushing into salty snacks (SkinnyPop, Dot's).

Century-old brands bought with the tongue, not the head. Reese's is the number-one candy brand in the US, and nobody grows up wanting a different chocolate. It also controls distribution at the checkout counter — that square foot a rival can't buy.

Revenue history

$9.0B
2021
$10.4B
2022
$11.2B
2023
$11.2B
2024
$11.7B
2025
CAGR 5 años: +7%

From $9.0B to $11.7B in 4 years. The business grows steadily.

Where each $100 of sales goes

Revenue $11.7B · FY2025

Cost of sales$7.8B · 67%
Operations$2.5B · 21%
Taxes and other$558M · 5%
Net profit$883M · 8%

Of every $100 in sales, $92 goes to costs and operations; $8 is left as net profit (8% margin).

Catalysts and risks

Price hikes already offsetting record cocoa; 34% gross margin should recover as the bean price falls in 2026.

Normalized FCF of ~$1.8B supports a dividend they've raised 15 years straight.

Salty snack expansion: SkinnyPop and Dot's diversify away from sugar.

⚠️

Cocoa at all-time highs is squeezing the gross margin; it already dropped from its historical ~45% to 34%.

⚠️

GLP-1 drugs and the anti-sugar crusade could cut consumption over the long run.

⚠️

$4.7B in debt with zero cash: little cushion if cocoa doesn't ease.

Charlie's note

Paying 8.61x for brands bought with the tongue that own the square foot at the checkout counter is buying quality without overpaying; with a 34% gross margin and 7% growth, all it takes is patience for these century-old brands to do the work.

Analysis · June 2026

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