Hershey price target lowered to $177 from $189 at Bernstein

Bernstein lowered the firm’s price target on Hershey (HSY) to $177 from $189 and keeps a Market Perform rating on the shares. The firm notes U.S. Food sector looks very inexpensive vs. the broader market, but acknowledges that there are still volume headwinds that could mean that this is a value trap — most notably GLP-1 uptake and a broader movement away from heavily processed foods. Food regulations could also be a challenge for packaged food in 2025 due to potential policies from RFK Jr., if he is appointed, says Bernstein. On margins, it sees surging cocoa and coffee costs while other inputs remain relatively benign, and stepped-up promotions may be needed in some areas to support volumes. The firm also expects further M&A activity this year, with Simply Good Foods (SMPL) being the most likely takeout candidate within its coverage.