Hershey (HSY) Laps the Stock Market: Here's Why

Hershey (HSY) recently saw a 1.15% gain, yet its stock has declined 2.08% over the past month, underperforming the S&P 500. The company is anticipated to report a significant 54.27% year-over-year EPS decline to $1.07 for its upcoming quarter on October 30, 2025, despite an expected 4.12% revenue increase to $3.11 billion. Full-year estimates also project a substantial 36.82% EPS drop to $5.92, alongside a 2.8% revenue rise, while HSY trades at a premium Forward P/E of 32.03 and PEG ratio of 4.58, compared to its underperforming Food - Confectionery industry.

Analysis

Hershey (HSY) recently posted a 1.15% daily gain, outperforming the S&P 500, yet its stock has experienced a 2.08% decline over the past month, lagging the broader market despite exceeding the Consumer Staples sector's 2.91% loss. The company's upcoming earnings report, slated for October 30, 2025, projects a substantial 54.27% year-over-year EPS fall to $1.07, juxtaposed with an anticipated 4.12% revenue increase to $3.11 billion.

Full-year Zacks Consensus Estimates reinforce this trend, forecasting a 36.82% decrease in EPS to $5.92, alongside a modest 2.8% revenue growth to $11.52 billion. Despite these expected declines, the Zacks Consensus EPS estimate has seen a slight 0.04% rise over the past month, suggesting a minor positive adjustment in short-term analyst sentiment, with Hershey currently holding a Zacks Rank of #3 (Hold).

HSY's valuation metrics indicate a premium, trading at a Forward P/E of 32.03 compared to its industry average of 21.92, and a PEG ratio of 4.58 against the Food - Confectionery industry's 3.49. This industry, part of the Consumer Staples sector, holds a Zacks Industry Rank of 213, placing it in the bottom 14% of all industries, which historically underperforms the top half.

Key Decisions for Investors

• Investors should closely monitor Hershey's upcoming earnings report for October 30, 2025, specifically focusing on the drivers behind the projected 54.27% EPS decline and the sustainability of revenue growth.
• Given HSY's premium valuation (Forward P/E of 32.03 and PEG ratio of 4.58) relative to an underperforming industry, investors should assess whether the current price adequately reflects future growth prospects and potential earnings headwinds.
• Consider the implications of the Food - Confectionery industry's low Zacks Industry Rank (213) on HSY's long-term sector performance, while acknowledging the recent slight positive revision in short-term EPS estimates.