UBS increased its price target on Hershey Co. (NYSE:HSY) to $236.00 from $210.00 while retaining a Neutral rating following the confectioner’s stronger-than-expected fourth-quarter results. The firm highlighted robust organic sales growth, margin expansion in the quarter and a fiscal 2026 outlook that surpassed consensus by roughly 15% at the low end.
Hershey shares were trading at $224.38, just below a 52-week high of $225.55, after generating a 52.12% return over the previous 12 months. The combination of the quarterly beat and management’s favorable forward guidance prompted a single-day share gain of 9% around the announcement, according to UBS analyst Peter Grom.
On the earnings front, Hershey reported fourth-quarter earnings per share of $1.71, well ahead of the consensus $1.40 estimate, a surprise of 22.14%. Revenue in the quarter came in at $3.09 billion versus expected revenue of $2.97 billion, underscoring the company’s stronger-than-forecast top-line performance.
UBS said it expects the company’s earnings momentum to continue into 2027, modeling a 27% year-over-year increase to $10.64 per share for that year. That projection contrasts with the prior Street estimate of $8.75 per share, reflecting a material upward revision to analysts’ expectations driven by the recent results and management’s outlook.
Despite those upgraded earnings forecasts, UBS kept its Neutral stance on the stock. The firm noted Hershey’s shares trade at about 21 times UBS’s 2027 EPS estimate, which it characterized as a 66% premium to the packaged food sector. UBS contrasted that premium with the sector’s five-year historical average premium of roughly 40%, suggesting valuation remains an important consideration for investors.
Other broker activity also reflected growing confidence in margins ahead. TD Cowen raised its price target on Hershey to $210 from $195 while maintaining a Hold rating. TD Cowen indicated it expects a significant gross margin recovery by 2026, citing favorable elasticity dynamics and tariff relief, and projects additional margin expansion in 2027 tied to lower cocoa prices.
Taken together, the data points show a company delivering near-term operational upside and projecting stronger earnings power over the medium term, while brokers and investors weigh those fundamentals against a premium valuation relative to peers.