Company Overview

The Hershey Company, founded by Milton S. Hershey in 1894, is an American multinational confectionery company headquartered in Hershey, Pennsylvania. The company is a leading US confectionery manufacturer, controlling around 36% of the domestic chocolate space in a market worth approximately $54 billion.

With a market capitalization of $33.381 billion as of September 2024, Hershey stands as one of the largest chocolate manufacturers globally. The company engages in the manufacture and sale of confectionery products and pantry items both in the United States and internationally, operating through three segments: North America Confectionery, North America Salty Snacks, and International.

The company exports its products to approximately 80 countries worldwide, making Hershey's chocolate available in 60 countries. The Hershey Trust Company owns a minority stake but retains a majority of the voting power within the company.

Business Segments and Market Position

Hershey operates across three primary business segments:

North America Confectionery

This segment represents Hershey's core business, manufacturing and selling chocolate and confectionery products. The company offers a wide range of products including chocolate and non-chocolate confectionery, gum and mint refreshment items (mints, chewing gums, bubble gums), protein bars, and pantry items like baking ingredients, toppings, beverages, and sundae syrups. Products are sold under iconic brands such as Hershey's, Reese's, Kisses, Jolly Rancher, Almond Joy, Brookside, barkTHINS, Cadbury, Good & Plenty, Heath, Kit Kat, Payday, Rolo, Twizzlers, Sour Strips, Whoppers, York, Ice Breakers, Breath Savers, Bubble Yum, and Lily's.

North America Salty Snacks

This segment includes snack items comprising spreads, bars, snack bites, mixes, popcorn, and pretzels under brands like SkinnyPop, Pirate's Booty, Dot's Homestyle Pretzels, and ONE Bar. The expansion into this segment was driven by strategic acquisitions including Amplify Snack Brands (SkinnyPop) for $1.6 billion in 2017, Pirate Brands for $420 million in 2018, and One Brands LLC for $397 million in 2019.

International Operations

The international segment markets products under brands like Pelon Pelo Rico, serving markets across Europe, Latin America, and Asia.

Recent Financial Performance

Full Year 2024 Results

For the full year ended December 31, 2024, Hershey reported consolidated net sales of $2,887.5 million, representing an increase of 8.7%. Organic, constant currency net sales increased 9.0%.

In 2024, the company generated revenue of $11.20 billion USD, an increase over the revenue in 2023 which was $11.16 billion USD. As of September 2024, Hershey's trailing twelve months (TTM) revenue stands at $11.29 billion USD.

Key Financial Metrics (September 2024)

- Market Cap: $33.381 billion

- Revenue (TTM): $11.29 billion

- P/E Ratio (TTM): 20.29

- EPS (TTM): $8.12

- Forward Dividend & Yield: $5.48 (3.30%)

- 52-Week Range: $140.13 - $208.03

Strategic Initiatives and Recent Developments

Leadership Transition

After eight years at the helm, CEO Michele Buck has passed the torch to Kirk Tanner, the former CEO of Wendy's. This leadership change marks a significant transition for the company as it continues to evolve its strategic direction.

Innovation and Brand Collaborations

The company has launched innovative collaborations, including the REESE'S OREO Cup and OREO REESE'S Cookie - a two-way collaboration between America's #1 Candy and #1 Cookie brand. Hershey has also introduced HERSHEY'S Milk Chocolate with Caramel bars as part of their 2025 s'mores program, which has driven double-digit growth.

Recent Acquisitions

In November 2024, Hershey announced its acquisition of Sour Strips, a fast-growing sour candy line with a significant social media presence. Recent major acquisitions include Lily's for $425 million in June 2021 and Dot's Homestyle Pretzels along with Pretzel INC for $1.2 billion in November 2021.

Manufacturing and Operations

Hershey operates what eventually became the world's largest chocolate-manufacturing plant in Derry Township, Pennsylvania. In September 2012, Hershey opened a new and expanded West Hershey plant completed at a budget of $300 million. The company also expanded its Kit Kat manufacturing facility in Hazle Township, Pennsylvania, with a $60 million expansion project expected to create 111 additional jobs.

Distribution and Sales Channels

Hershey markets and sells its products to wholesale distributors, chain grocery stores, mass merchandisers, chain drug stores, vending companies, wholesale clubs, convenience stores, dollar stores, concessionaires, and department stores. The company also operates its own retail outlets such as Hershey's Chocolate World, which offer exclusive products and experiences, and has embraced e-commerce by selling products directly to consumers via its online store and other digital platforms.

Market Challenges and Outlook

The company faces significant pressure from surging cocoa prices, which are expected to impact 2025 earnings substantially. Reported earnings per share is expected to decline in the high-40% range, while adjusted earnings per share is projected to be down in the mid-30% range when excluding one-time costs.

Despite these challenges, management remains focused on driving top-line and share momentum, executing transformation and productivity programs, and positioning the company to deliver peer-leading performance over the long-term.

The Hershey Company continues to leverage its strong brand portfolio, strategic acquisitions, and innovation capabilities to maintain its leadership position in the North American confectionery market while expanding its presence in the growing salty snacks category and international markets.