Stock of the Week: Hershey

'Tis the season?

Andrew Willis 22 December, 2020 | 5:00
Facebook Twitter LinkedIn

 

 

See more episodes of Stock of the Week here

Andrew Willis: Cravings for chocolates and sweets persisted this year, and coupled with a successful Halloween season, investors in confectioners did well! Will this continue through the holiday season?

The sweet tooth market was rather resilient this year, notes sector director Erin Lash. All eyes were on how Hershey would fare when trick-or-treating was cancelled, but we found out that third-quarter sales were 4% higher from last year.

Much of this growth was because of Hershey, specifically. It moved fast on Halloween, getting products on shelves early to make shoppers treat themselves first.

Similar unimpeded demand was seen in the last economic recession around 2008, and with a much less captive audience. And while more than 90% of the company’s candy is still bought in-person, it wasn’t surprising to see an 80% increase in online sales considering its focus on innovation.

So while it is the season to gift – and eat – candy, considering how Hershey is encouraging year-round demand… it might just be the icing on the cake.

For Morningstar, I’m Andrew Willis.

Facebook Twitter LinkedIn

About Author

Andrew Willis  is Senior Editor for Morningstar Canada

© Copyright 2024 Morningstar Asia Ltd. All rights reserved.

Terms of Use        Privacy Policy       Disclosures