The Hershey Company

Hershey is the largest chocolate maker in North America. Its best-known brands are Hershey's, Reese's, Kit Kat (which Hershey makes and sells in the US under a license from Nestlé), Jolly Rancher, Twizzlers, and Ice Breakers. North America Confectionery, the chocolate and candy business, brought in about 81% of net sales in 2025. Hershey also sells salty snacks, including SkinnyPop popcorn, Dot's Homestyle Pretzels, and LesserEvil, an organic snack brand it bought in November 2025.

A smaller International segment sells mostly in Mexico, Brazil, India, and Malaysia. Sales peak around Halloween, Christmas, Valentine's Day, and Easter. The Milton Hershey School Trust, a charity that runs a free boarding school, controls about 80% of the shareholder votes through special Class B shares. This means no one can buy Hershey unless the trust agrees.

Hershey's price reflects worry about shrinking candy volumes, not a temporary mood. Cocoa prices spiked in 2024, so Hershey raised prices about 12%. Shoppers responded by buying less candy. But profit is recovering.

Gross margin rose sharply in the most recent quarter, and management raised the low end of its full-year earnings outlook. Cocoa has fallen from its peak, and management expects further declines into 2027, though cocoa rose again in late August 2026 before it eased in September. For the gap to close, volume needs to stop falling while cocoa costs keep easing. That would let margins keep rising through 2027.

Hershey's brands showed real pricing power, since the company raised prices sharply and kept most of its customers. The main risk to this case is that high prices, a weaker low-income shopper, and weight-loss drugs keep shrinking how much candy people buy. Management has described 2026 and 2027 as years of restoring profit. It expects a more balanced mix of sales and profit growth to return from 2028.

The next tests are Q3 2026 results on October 29, 2026, cocoa costs through the rest of 2026, and full-year 2026 results due in early 2027. If volumes stabilize and cocoa keeps easing, the gap could close over the next several quarters. If cocoa spikes again or volumes keep falling, it could take until 2028.

1. Oct 29, 2026Pending

   Q3 2026 earnings: Halloween season volume and marginA smaller volume decline, higher adjusted gross margin and the $8.36 to $8.52 EPS outlook held or raised pass; a deeper volume drop or a lower outlook fails.
2. Feb 2027 · est.Pending

   Full-year 2026 results and 2027 outlookA 2027 outlook with double-digit EPS growth and stable volume passes; an outlook cut because of new cocoa costs or weak demand fails.
3. Apr 2027 · est.Pending

   Q1 2027 earnings: cocoa cost relief shows in marginsGross margin up again as lower hedged cocoa costs arrive and volume flat or up passes; margin pressure from the September 2026 cocoa jump fails.

Every passed and failed checkpoint across all picks

Hershey funds itself with cash from operations and with unsecured fixed-rate notes that the parent company issues. The debt does not limit Hershey, and Moody's expects leverage on its own measure to fall from the mid-2 times range to below 2 times over 12 to 18 months. Read more

• Hershey is selling less candy. After raising prices by about 12%, volume fell about 8% in Q2 2026. In North America Confectionery, volume fell about 10%. Management said low-income households are under the most pressure. If volume keeps falling once the price increases stop adding growth, sales could shrink.
• Hershey's plan to recover its margins depends on cocoa costs falling in 2027. Cocoa futures in New York rose to about $6,800 per ton in late August 2026, because of weather risk and a smaller crop in Ghana. They fell to about $5,370 on September 30 and closed at $5,665 on October 9. Hershey hedges cocoa 3 to 24 months ahead, so a new price spike would hit its costs with a delay, not right away.
• GLP-1 weight-loss drugs, like Wegovy and Zepbound, reduce appetite. As more people use them, they may buy less candy and snacks, which would slowly shrink Hershey's main market.
• The salty snacks business is growing but earning less. In Q2 2026, segment sales grew 22.9%, mostly from LesserEvil, but segment profit fell 5.9%. Management has pointed to supply problems at Dot's Pretzels that new automation is meant to fix in 2027. Hershey paid about $769 million for LesserEvil, so a weak return there would hurt.
• Hershey has changed several top leaders in a short time. CEO Kirk Tanner joined in August 2025, the President, US left in May 2026, a new Chief Supply Chain Officer started in June 2026, CFO Dave Hulays took over in September 2026, and a new President, International starts in October 2026. This much turnover at the top adds execution risk during the margin recovery.
• The Milton Hershey School Trust controls about 80% of the shareholder votes. It has blocked takeover bids before, so ordinary shareholders are unlikely to get a buyout premium, and they have little say over the board. The trust also sold about 1.45 million common shares from March to October 2026 under a trading plan. This did not change its Class B shares, which hold most of its votes.
• Hershey had about $5.6 billion of debt and $0.8 billion of cash at the end of June 2026. This is manageable for a company this profitable, but it leaves less room for another large acquisition or bigger buybacks while margins recover.

• October 9, 2026Hershey confirmed that it will report Q3 2026 results on October 29, 2026, with a conference call at 8:30 a.m. ET.
• October 9, 2026From March 16 to October 9, 2026, the Milton Hershey School Trust sold about 1.45 million common shares for about $267 million, under a Rule 10b5-1 trading plan, per its Form 4 filings. Its Class B shares did not change, so its voting control stays at about 80%.
• October 1, 2026Hershey named Amanda Almond President, International, effective October 12, 2026. She replaces Rohit Grover, who led the International segment for eight years. She was previously a regional managing director at the wine company Vinarchy, and she worked 12 years at Bacardi.