NEW YORK, June 23, 2026, 18:07 EDT
Hershey (HSY) shares surged 4.9% to finish at $179.27 Tuesday, breaking a three-day slide. That came as the S&P 500 dropped 1.44%. Mondelez added 2.6%, and J.M. Smucker was up 3.1%. Hershey also saw trading volume above its 50-day average.
Hershey’s rally on Tuesday bumped its market value by about $1.7 billion, going by the closing price, but shares are still down about 25% from the 52-week high of $239.48. The company closed around a $36.4 billion market cap.
So the move looks more like a play on cocoa margins than a classic “defensive staples” trade. Cocoa is still much cheaper than it was last year, but prices have started to pick up. Cocoa prices were up about 0.8% Tuesday, according to a tracker, putting them 11.7% higher for the month, though still off around 49% from the same point last year. Trading Economics
July ICE New York cocoa futures finished up Tuesday. Barchart said heavy rain in Ivory Coast and possible disease risks for cocoa trees were factors. Cocoa prices dropping has given investors a reason to reconsider Hershey after margins have been squeezed.
Hershey’s Q1 sales jumped 10.6% to $3.10 billion. Organic constant-currency sales were up 7.9%. Adjusted EPS climbed 12.4% to $2.35. Organic sales exclude currency shifts and deals. Hershey kept its outlook for 4% to 5% net sales growth and expects adjusted EPS to rise 30% to 35% for the full year, with adjusted EPS excluding certain items.
Hershey CEO Kirk Tanner said after the quarter that Hershey’s and Reese’s saw first-quarter non-seasonal retail sales rise 11% and 10%. Pricing drove most of that. North America confectionery net price realization was up about 12 points. But volume dropped around 4 points. That sets up the stock’s rebound on a single issue: how much of the price increase can Hershey hold on to while avoiding further volume losses.
Management sounded more positive than the stock’s recent moves. Tanner told analysts that competition is “highly rational” and there’s “no change in the pricing environment.” CFO Steven Voskuil said price elasticity—demand swings when prices shift—remains stronger than Hershey expected. The Motley Fool
Hershey is pushing to cut back its reliance on chocolate bars. Reuters said in April that the company topped quarterly estimates as sales of mints and healthier snacks drove results. Ice Breakers retail sales jumped 8%, and organic volume in North America salty snacks rose 5%. Tanner said functional snacking is “a small but mighty part” of growth. Reuters
Analyst sentiment is mixed. MarketScreener put the consensus target for Hershey at $217.14, 21% above where shares finished Tuesday, but price targets ran from $166 to $255. That gap sums up the debate: Hershey looks cheap if cocoa costs drop and pricing sticks, but pricey if volume lags or costs climb.
But the risk isn’t just theoretical. Reuters said Monday that more rain and cloud cover in Ivory Coast, the world’s biggest cocoa grower, is leading to concerns about floods and crop disease late in the mid-crop. “If it keeps raining like this all week, the plantations may experience flooding,” farmer Kevin Kamena said. Another surge in cocoa prices would put more pressure on Hershey’s margin rebound, with confectionery volumes already slipping. Reuters
