Hershey stock rating reiterated at Underweight by Piper Sandler

Investing.com - Piper Sandler has reiterated its Underweight rating and $167.00 price target on Hershey (NYSE:HSY) stock, maintaining its cautious stance on the confectionery giant. Currently trading at $186.80, InvestingPro analysis suggests the stock is slightly overvalued, despite its strong financial health rating and impressive 55-year track record of consistent dividend payments.

The research firm notes that Hershey is focusing on convenience store channels, where sales growth has returned to positive territory, particularly in chain stores which are outperforming independent locations by approximately 4.5 percentage points (3.0% versus -1.5%).

Prepared foods are driving significant momentum in convenience stores, as consumers perceive better price-to-value ratios compared to quick-service restaurants, a trend Hershey has been capitalizing on through improved promotion optimization.

Piper Sandler highlights that Hershey is partnering with chain stores to offer combo meal discounts when customers add salty snacks or confectionery products to their purchases.

The firm also acknowledges Hershey’s leadership in data analytics, which the company leverages to optimize shelf arrangements, product assortment, and promotional strategies across its retail channels.

In other recent news, Hershey Co reported its second-quarter earnings for 2025, surpassing Wall Street expectations with an earnings per share of $1.21, significantly higher than the forecasted $0.99. The company’s revenue also exceeded expectations, reaching $2.61 billion against a forecast of $2.52 billion. Meanwhile, Goldman Sachs upgraded Hershey’s stock rating from Sell to Buy, citing a "compelling risk/reward set-up" and raising its price target to $222.00 from $170.00. Piper Sandler also adjusted its outlook, increasing its price target for Hershey to $167.00 from $160.00, due to relief from Canadian reciprocal tariffs. These tariffs, removed on September 1, previously accounted for about 25% of Hershey’s quarterly $100 million tariff headwind. Additionally, DA Davidson reiterated a Neutral rating on Hershey stock, focusing on discussions about cocoa pricing and tariffs with the company’s leadership. In corporate governance news, Hershey announced that director Juan R. Perez will retire from the board in October 2025, with the company stating his decision was not due to any disagreements.

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