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Hershey Sets the Mood for the Holidays

Zacks Equity Research

Chocolate maker The Hershey Company (HSY) strives to create a unique and holistic holiday collection every season to meet consumer preferences. Carrying on with the same strategy, the company introduced its 2013 Holiday Collection recently.

This holiday season Hershey is offering festive canes (Reese’s brands Peanut Butter Cup Cane, the Jolly Rancher Cane, the Bubble Yum Cane), stocking stuffers (Twizzlers’ Tree Shaped Cherry Candy, Hershey's Candy Cane Bar Mint Candy with Candy Bits) and other goodies (Hershey's Almond Clusters, Pretzels and Rolo Holiday Candies) for its customers.

Hershey brings about regular innovation in its core brands to meet consumer demand and needs that are not addressed by its current portfolio. These new and classic favorites prove to be an example of these efforts. During the Halloween week, the company introduced eight new treats which included caramels, lollipops, chocolates and candies.

Other players in the industry are also keeping themselves busy with new product launches. In Oct 2013, Crumbs Bake Shop (CRMB) introduced the Crumbs Cupcake Collection under its brand Girl Scouts.

Hershey is the largest producer of quality chocolate in the U.S. with a market share of 43%. The company continuously invests in advertising and marketing capabilities to build its brands globally and monitors the performance of its brands.

This has resulted in improving volume trends and market share in the U.S. over the past many years. Hershey’s strong brand positioning, strategic marketing investments in core brands, disciplined innovation and consumer capabilities make it an attractive investment opportunity.

However, even though the company is fast expanding its presence outside the U.S., we wait for some meaningful progress and substantial profitability from these efforts. The Hershey Company presently has a Zacks Rank #3 (Hold). Among the stocks worth considering in the space are Omega Protein Corp. (OME) and Pinnacle Foods Inc. (PF). While Omega Protein carries a Zacks Rank #1 (Strong Buy), Pinnacle Foods holds a Zacks Rank #2 (Buy).

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Read the Full Research Report on OME

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