Stock Analysis | The Hershey Outlook - Caution Amid Mixed Signals and Strong Fundamentals

Market Snapshot

Headline Takeaway: The Hershey stock is in a weak technical state with mixed signals, but strong fundamentals and favorable fund flows offer a counterbalance. Stance: Cautious optimism.

News Highlights

• Processed Food Exports Surge: India's processed food exports surged 15% in April 2025, reaching $2.13 billion, led by strong rice, meat, and fruit shipments. This suggests continued demand for packaged food products, potentially benefiting companies like Hershey.
• Diabetic Food Market Growth: The global diabetic food market is projected to grow from $14.63 billion in 2025 to $24.86 billion by 2033, driven by rising demand for low-sugar and low-carb products. Hershey's product portfolio could align with this trend, depending on its offerings.
• BigBasket Pilots 10-Minute Food Delivery: BigBasket in India has launched a 10-minute food delivery service in Bengaluru, partnering with Starbucks and Qmin. While this is a regional move, it reflects growing trends in rapid food delivery, which could influence consumer behavior in other markets.

Analyst Views & Fundamentals

Average Rating Score (Simple Mean): 2.71

Weighted Rating Score (Performance-Weighted): 3.01

Rating Consistency: Analyst ratings are relatively consistent, with 5 out of 7 recent ratings classified as "Neutral" and 2 as "Sell". The market expects moderate returns, with a slight bearish tilt.

Price Trend Alignment: The current price trend shows a 3.00% rise, which is in line with the market's relatively neutral expectations. Analysts are not overly optimistic, but their projections do not signal a sharp decline either.

Key Fundamental Factors

• ROA (Return on Assets): 0.46% (Internal diagnostic score: 8.37)
• Net Cash Flow from Operating Activities / Total Liabilities: 5.57% (Internal diagnostic score: 8.37)
• EV/EBIT: 9188.11 (Internal diagnostic score: 8.37)
• Net Income to Revenue: -142.70% (Internal diagnostic score: 8.37)
• CFOA (Cash Flow from Operating Activities): 0.82% (Internal diagnostic score: 8.37)

The strong internal diagnostic scores across these metrics suggest that Hershey's fundamentals remain robust despite mixed analyst views. Investors should monitor whether these fundamentals continue to support the current price trend.

Money-Flow Trends

Recent fund flow data shows a negative overall trend, with inflow ratios across all investor categories (small, medium, large, and extra-large) dipping below 50%. Specifically:

• Small Inflow Ratio: 49.54%
• Medium Inflow Ratio: 48.57%
• Large Inflow Ratio: 49.04%
• Extra-Large Inflow Ratio: 45.17%
• Block Inflow Ratio: 47.20%

Despite the bearish trend in fund flows, the fund-flow score of 7.81 (internal diagnostic score, 0-10) indicates that the stock is considered to have "good" flow characteristics. However, the negative trend across all investor segments suggests that both big money and retail investors are cautious.

Key Technical Signals

The technical score for Hershey stands at 4.62 (internal diagnostic score, 0-10), reflecting a weak technical state that warrants caution.

Internal Diagnostic Scores for Key Indicators

• Ex-Dividend Date: 7.75
• Marubozu White: 5.82
• WR Overbought: 3.55
• Dividend Record Date: 6.59
• WR Oversold: 3.63
• Bearish Engulfing: 2.79
• Bullish Engulfing: 2.22

With 4 bearish indicators versus 1 bullish one, the technical signals are heavily skewed toward bearish sentiment. The recent chart patterns, including WR Overbought and Bearish Engulfing, reinforce the cautious stance.

Recent Chart Patterns

• 2025-08-29: WR Overbought
• 2025-08-26: WR Overbought, Bullish Engulfing
• 2025-08-15: Bearish Engulfing, Ex-Dividend Date, Dividend Record Date
• 2025-08-12: WR Oversold
• 2025-08-13: Marubozu White

The recent appearance of the Ex-Dividend Date indicator (score: 7.75) offers a bullish bias, but it is being overshadowed by stronger bearish signals. Traders should monitor for a potential reversal if the Marubozu White pattern (8/13) shows follow-through buying.

Conclusion

Hershey's fundamentals are strong, with an internal diagnostic score of 8.37, but its technical signals are weak, scoring 4.62 (internal diagnostic score, 0-10). The stock also shows a negative fund-flow trend, though it is supported by a 7.81 (internal diagnostic score, 0-10) flow rating. Analysts remain cautiously neutral, with most ratings falling in the "Neutral" range.

Actionable Takeaway: Given the divergence between strong fundamentals and weak technical signals, investors may want to consider a "wait and see" approach, especially with the Ex-Dividend Date (bullish bias) and Marubozu White pattern recently appearing. Closely monitor earnings and any follow-through buying after the bearish indicators lose momentum.