The Hershey Company (HSY – Research Report), the Consumer Defensive sector company, was revisited by a Wall Street analyst yesterday. Analyst Thomas Palmer from Citi upgraded the rating on the stock to a Hold and gave it a $154.00 price target.
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Thomas Palmer has given his Hold rating due to a combination of factors affecting The Hershey Company’s stock. The stock has seen a significant decline of 24% over the last six months, positioning it as the second-worst performer in its coverage. Despite this drop, the shares are still trading at a high valuation of over 25 times this year’s earnings, with cocoa prices remaining elevated. This high valuation and persistent cocoa costs suggest limited short-term upside potential for the stock.
Palmer acknowledges that the company’s recent 2025 guidance provides a solid foundation for growth in 2026, assuming cocoa prices do not decrease. However, he has adjusted earnings estimates downward, reflecting the continued high cocoa prices and the company’s moderate pricing actions. He also revised the target price to $154 from $159, recognizing potential upside from factors such as lower price elasticity, further price actions, and possible declines in cocoa costs, although these are uncertain. Overall, the Hold rating reflects a balanced view of risks and potential growth drivers for The Hershey Company.