Hershey initiated with a Sell at Redburn Atlantic

Redburn Atlantic analyst Bingqing Zhu initiated coverage of Hershey (HSY) with a Sell rating and $165 price target The firm says its analysis :highlights multiple challenges” for Hershey, including flat chocolate consumption, rising health concerns and intensified competition. It models 1.4% organic sales growth in the long term, which is below consensus. The stock’s valuation “is still too rich” for a company that offers organic sales growth that is below the staples sector average over the long term, with increased near-term risk due to pricing needed to offset cocoa inflation, along with sector-leading margins that have little room to expand, the analyst tells investors in a research note.