Hershey Quarterly Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Hershey (NYSE:HSY) will unveil its latest earnings tomorrow, Thursday, July 26, 2012. Hershey manufactures chocolate and confectionery products, food and beverage enhancers and gum and mint refreshment products.

Hershey Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 61 cents per share, a rise of 8.9% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 63 cents. Between one and three months ago, the average estimate moved down. It has been unchanged at 61 cents during the last month. Analysts are projecting profit to rise by 13.1% versus last year to $3.19.

Past Earnings Performance: Last quarter, the company topped estimates by 0 cents, coming in at profit of 96 cents per share against a mean estimate of net income of 81 cents. The company fell in line with estimates in the fourth quarter of the last fiscal year.

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A Look Back: In the first quarter, profit rose 24.1% to $198.7 million (87 cents a share) from $160.1 million (70 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 10.7% to $1.73 billion from $1.56 billion.

Stock Price Performance: Between April 25, 2012 and July 24, 2012, the stock price rose $4.39 (6.65%), from $66 to $70.82. The stock price saw one of its best stretches over the last year between June 11, 2012 and June 20, 2012, when shares rose for eight straight days, increasing 5% (+$3.34) over that span. It saw one of its worst periods between February 2, 2012 and February 10, 2012 when shares fell for seven straight days, dropping 3.2% (-$2) over that span.

Wall St. Revenue Expectations: Analysts predict a rise of 6.8% in revenue from the year-earlier quarter to $1.42 billion.

Key Stats:

After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose 9.2% in the third quarter of the last fiscal year and 4.9% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 7.5% in the second quarter of the last fiscal year, 5% in the third quarter of the last fiscal year and 5.7% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.52 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.74 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 12.8% to $1.32 billion while assets decreased 1.7% to $2.01 billion.

Analyst Ratings: There are mostly holds on the stock with 10 of 14 analysts surveyed giving that rating.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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