Hershey Company sells chocolate and sugar confectionery products, pantry items, such as baking ingredients, toppings, sundae syrups, and beverages, snack items, including spreads, and gum and mint refreshment products comprising chewing gums and bubble gums. The company was founded in 1894 and is based in Hershey, Pennsylvania.
HSY Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Hershey Co. To summarize, we found that Hershey Co ranked in the 48th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 14.67%. The most interesting components of our discounted cash flow analysis for Hershey Co ended up being:
Interest coverage, a measure of earnings relative to interest payments, is 9.81; that's higher than 73.02% of US stocks in the Consumer Defensive sector that have positive free cash flow.
HSY's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 26.86% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Consumer Defensive that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as HSY, try USNA, THS, PM, KDP, and CAG.
HERSHEY, Pa., Oct. 1, 2020 /PRNewswire/ -- Halloween will undoubtably look different this year, so Hershey is guaranteeing Halloween fun no matter how you choose to celebrate. Introducing the first-ever Hershey Halloween Squad, a cadre of industry experts that hold the keys to an…