The Hershey Company (HSY) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: The Hershey Company

Updated on October 31, 2026 · accounts published on October 29, 2026

A highly profitable business whose margins are recovering after a weak year

Hershey trades at a P/E of 18.7 over the last 12 months, 30 % below its ten-year median of 26.9 and 17 % below its sector median.

• Is Hershey expensive or cheap? At 18.7 times trailing earnings, Hershey's P/E sits 30 % below its ten-year median; it has been cheaper only 11 % of the decade.
• How is the business doing? Operating margin is 21 % over the last 12 months, back above its 2014-2025 average of 20 % after a 12-year low in fiscal 2025.
• How strong is the balance sheet? Net debt is 2.3× EBITDA in fiscal 2025, just inside the 2.5× healthy limit, while the dividend took 123 % of earnings.
• What to expect from the next earnings? Analysts expect EPS of $1.98 for the quarter Hershey reports on February 4, 2027, after eight straight beats.
• Is it as stable as the sector promises? Hershey passes six of eight consumer staples tests; its 33 % gross margin in fiscal 2025 sits just under the 35 % stability bar.

Is Hershey expensive or cheap?

Hershey trades at a P/E of 18.7 over the last 12 months. Its ten-year median is 26.9, and over the decade the P/E has ranged from 14.2 to 46.5. It is also 17 % below the 22.5 median of its 95 sector peers. EV/EBITDA of 13.1× and a free cash flow yield of 6.6 % tell the same story. The share price is 29 % below its 52-week high of $236.28 and down 1 % over 12 months. The discount looks real, but trailing earnings fell sharply, so it holds only if the recovery does.

How is the business doing?

Fiscal 2025 was Hershey's weakest year in more than a decade. The operating margin fell to 12 %, the lowest of the 12 years since 2014, and ROIC dipped to 9.0 %. The last 12 months look different: revenue grew 4.4 %, the operating margin recovered to 21 % and ROIC reached 17 %, 8.3 points above the sector median of 8.9 %. ROIC has stayed above 10 % in nine of the last ten years, so the long record is solid. The weak spot is trailing EPS, down 60 % year over year, which makes 12-month comparisons noisy.

How strong is the balance sheet?

Hershey's debt is manageable but leaves little slack. Net debt of $23.02 per share in fiscal 2025 equals 14 % of the current price, and debt-to-equity stands at 1.05 over the last 12 months. An Altman Z of 4.2 is in the safe zone, while a Piotroski score of 5 out of 9 is middling. The dividend yields 3.5 % over the last 12 months, yet the fiscal 2025 payout ratio of 123 % is far above the sector's 75 % comfort level. Cash still covers it: the 6.6 % free cash flow yield is nearly double the dividend yield.

What to expect from the next earnings?

Hershey has beaten EPS estimates in each of the last eight quarters. On October 29, 2026 it reported EPS of $2.64 against $2.11 expected, a 25 % surprise. Even so, the 2026 EPS consensus barely moved over the past 30 days, from $8.49 to $8.48 across 13 analysts, and the revenue consensus held steady. Of the 35 analysts covering the stock, 9 rate it a buy, 23 a hold and 3 a sell, which is a cautious stance. On February 4, 2027, the test is whether Hershey clears the $1.98 bar again.

Is it as stable as the sector promises?

Consumer staples are the steady businesses Buffett favors. Investors look for stability and a growing dividend rather than fast growth, so the tests focus on margins, cash conversion and dividend record. Hershey turned 198 % of net income into free cash flow in fiscal 2025, well above the 90 % healthy mark. It raised its dividend 9.4 % a year over 2015-2025, against a 6 % bar. EPS growth of 6.4 % a year over the same decade clears that bar only narrowly. The 33 % gross margin is borderline, and the payout ratio is the clear fail.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.