Hershey Beats Analyst Estimates on EPS

Seth Jayson, The Motley Fool
Updated

Hershey (NYSE: HSY) reported earnings on July 26. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended July 1 (Q2), Hershey met expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue improved and GAAP earnings per share increased.

Gross margins expanded, operating margins expanded, net margins contracted.

Revenue details
Hershey reported revenue of $1.41 billion. The 11 analysts polled by S&P Capital IQ predicted sales of $1.42 billion on the same basis. GAAP reported sales were 6.7% higher than the prior-year quarter's $1.33 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.66. The 15 earnings estimates compiled by S&P Capital IQ anticipated $0.61 per share. GAAP EPS of $0.60 for Q2 were 7.1% higher than the prior-year quarter's $0.56 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 44.7%, 160 basis points better than the prior-year quarter. Operating margin was 17.2%, 10 basis points better than the prior-year quarter. Net margin was 9.6%, 20 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $1.75 billion. On the bottom line, the average EPS estimate is $0.87.

Next year's average estimate for revenue is $6.58 billion. The average EPS estimate is $3.23.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 527 members out of 634 rating the stock outperform, and 107 members rating it underperform. Among 192 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 168 give Hershey a green thumbs-up, and 24 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Hershey is outperform, with an average price target of $69.93.

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