JPMorgan assumes coverage on Hershey stock with Neutral rating

Published 20/08/2025, 09:50
JPMorgan assumes coverage on Hershey stock with Neutral rating

Investing.com - JPMorgan has assumed coverage on Hershey (NYSE:HSY) with a Neutral rating and a price target of $187.00, up from the previous target of $146.00. According to InvestingPro data, the company maintains a ’Good’ financial health score, with liquid assets exceeding short-term obligations at a current ratio of 1.53.

The firm notes that Hershey appears to be approaching a positive earnings inflection point, despite potential weakness in near-term earnings, particularly in the third quarter of 2025. InvestingPro analysis reveals that 14 analysts have revised their earnings downwards for the upcoming period, though the company remains profitable with a trailing twelve-month EPS of $7.53.

JPMorgan highlights that Hershey plans to implement a mid-teens percentage price increase soon to combat inflation, while margin headwinds from tariffs and cocoa costs could be nearing peak levels.

The research firm believes Hershey’s price elasticity assumption of approximately 1x seems sufficiently conservative, considering the volume stability observed during past price increases both for the company and the industry.

JPMorgan factors in valuation multiples on P/E and EV/EBITDA that exceed Hershey’s historical averages, but indicates that if cocoa futures prices decline or cocoa becomes exempt from tariffs, Hershey shares would likely move higher.

In other recent news, Hershey has made headlines with several significant developments. The company reported second-quarter earnings per share of $1.21, surpassing expectations by $0.20, largely due to stronger-than-forecast volume and effective cocoa mitigation efforts. This positive performance led Stifel to raise its price target on Hershey to $185, while maintaining a Hold rating. Similarly, CFRA increased its price target to $212, citing the company’s solid momentum and potential outcomes for 2026.

In governance news, Hershey appointed Huong Maria T. Kraus as the new chairman of the board, following Michele G. Buck’s retirement. Kraus has been a member of Hershey’s board since May 2023 and brings experience in governance, finance, and corporate development. Despite these positive developments, DA Davidson reiterated a Neutral rating on Hershey, highlighting ongoing cocoa challenges. These updates reflect Hershey’s recent strategic and operational activities.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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