Hershey stock rating raised to buy-UBS
2022.12.08 10:52
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Hershey stock rating raised to buy-UBS
Budrigannews.com – (NYSE) Hershey was moved up from Neutral to Buy, and UBS raised its price target from $244 to $269.
In a note to investors, analysts stated that Hershey would continue to be in a beat and raise cycle through 2025 due to the outperformance of the large-cap packaged food sector thus far this year.
“While our LT confidence is driven by a more accommodative operating environment in Confection and a long runway of growth for substantial Snacks business, our NT confidence is supported by wrap-around price benefits in 2023 and capacity additions. The analysts wrote, “We believe HSY can achieve 4% OSG growth and 9% EPS growth over the LT, which is above the Street’s 3% and 7% expectations, respectively.”
UBS likewise says the organization has better perceivability in 2023 contrasted with most others.
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“We perceive a high level of concern among the investors we speak with regarding the earnings growth for packaged food in 23 given: ( 1) the unusually low visibility we experience at this time of year.
The analysts stated, “2) FX headwinds are likely to remain high, 3) inflation for the group is likely to rise +DD, 4) supply chains have not yet returned to normal productivity, and 5) interest expense and pension income are likely to be greater headwinds.”
“We think that HSY has more visibility than most in this challenging operating environment. We anticipate that HSY will experience below-average inflation (+9%), the highest sales growth (+9%), and lower interest and pension income headwinds (-1% to EPS) than most of its peers in the lg cap packaged food sector. In conclusion, we anticipate that the gap between HSY’s (+14%) EPS growth and that of peers (+4%) will widen in 2023.”
Hershey’s portion cost has acquired more than 1% such a long ways on Thursday.
