How Hershey Is Sharpening Morgan Stanley's Sweet Tooth
Valentines Day is around the corner and Hershey Co (NYSE: HSY) has been slowly pushing higher since mid-August 2014.
The fundamental story remains strong on a relative basis against its peers.
Morgan Stanley analyst Matthew Grainger remains Equal-weight on Hersey and expects the company’s EDITDA valuation (less than 1.0x) to “offer flexibility to consider accretive M&A” alongside the possibility of share repurchases.
Grainger defended Hersey’s balance sheet strength by citing the “incremental dairy deflation” during the past quarter, and increased his 2015 EPS estimate from $4.42 to $4.45 despite FX headwinds.
Four things Morgan Stanley says to watch for are:
- Progress of MarkTen national rollout
- Potential options for monetization of SABMiller stake
- Cost and pricing optionality surrounding quota buyout expiration
- 2015 outlook and guidance
Hersey shares traded down 0.5 percent mid-way through the morning session to $109.20.
Latest Ratings for HSY
|Feb 2017||Argus Research||Upgrades||Hold||Buy|
|Feb 2017||Deutsche Bank||Initiates Coverage On||Hold|
|Jan 2017||Credit Suisse||Upgrades||Neutral||Outperform|
© 2017 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.