Is Candy stock Hershey a buy as it guides FY2021 earnings ahead of Street forecast?
- Hershey’s shares on Thursday edged slightly higher after announcing its most recent quarterly results.
- The company posted its FQ3 results before markets opened, beating the consensus for Street expectations.
- Hershey’s also issued FY2021 earnings slightly above Street estimates.
On Thursday, Hershey Co. (NYSE:HSY) shares edged slightly higher after announcing its most recent quarterly results. The company reported its fiscal third-quarter revenue and earnings before markets opened, beating the consensus for Street expectations. In addition, Hershey’s issued FY2021 earnings per share guidance slightly above analyst estimates.
The company posted FQ3 non-GAAP earnings per share of $2.10, beating the average for analyst estimates of $2.00. In addition, the company’s GAAP EPS of $2.14 outperformed the expectation of $1.94, while revenue for the quarter increased by 6.3% from the same quarter in 2020 to $2.36 billion, $30 million ahead of estimates.
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Hershey’s shares are up 6.5% this month amid rising seasonal candy sales.
Is it too late to buy HSY stock?
From an investment perspective, Hershey’s shares trade at reasonable trailing 12-month and forward P/E ratios of 26.10 and 25.23, respectively. As a result, the stock could gain the attention of value investors.
Looking forward, expect Hershey’s earnings per share to grow by 11.90% this year before rising at an average annual rate of 8.89% over the next five years.
Therefore, the stock could also be an exciting option for growth investors.
Technically, Hershey’s stock price seems to have recently pulled back to trade closer to the trendline support in the intraday chart. However, the stock is still far from reaching the oversold conditions of the 14-day RSI.
Therefore, although the stock seems reasonably valued, investors could target extended pullbacks at about $178.13, or lower at $175.51.
On the other hand, if the stock bounces back, rejecting a retest of the trendline support, it could find resistance at $182.76, or higher at $185.38.
Hershey seems poised for a rebound
In summary, although Hershey shares are up nearly 20% this year and more than 30% over the last 12 months, the stock still trades at reasonable valuation multiples, making it an option for different types of investors.
Therefore, given the recent pullback and its exciting growth prospects, it could be time to bet on HSY shares.