Hershey stock pops, raises quarterly dividend 15%
Shares of Hershey (HSY) are bouncing back after pre-market trading on Thursday, gaining over 5%. The company's results and full-year guidance for 2024 have been weighed down by rising cocoa prices. However, the food company did announce it was raising it quarterly dividends by 15%.
Yahoo Finance Anchors Rachelle Akuffo and Akiko Fujita break down the latest development for Hershey and what it means for the company moving forward.
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Editor's note: This article was written by Nicholas Jacobino
Video Transcript
AKIKO FUJITA: Time now to take a look at today's trending ticker. It's suddenly a sweet day for Hershey's, as the stock reverses course. Now, up more than 5% after falling initially on news. Historically, high cocoa prices will limit earnings growth this year.
Rachelle, this is a fun one to talk about because we want to think about where the habits are. Cocoa prices, yes. A big part of that narrative coming through from the quarter. But I've been watching just the mix for Hershey.
We talked so much about Hershey chocolate, sweet confectionery. The company's been really trying to expand further into salty snacks. So we're talking about SkinnyPop, Pirate's Booty, Dot's Pretzels. But there was a significant drop there. Sales fell 24.6% compared to where it was a year ago.
Some of that inventory management issue as well. But I don't know. I'm curious about what that demand looks like moving forward. Sweet or salty?
RACHELLE AKUFFO: I'm always going to be team sweet. Born and raised on chocolate. Full confession, I used to eat about five chocolate bars a day, like, obsessed. It was a problem.
So I'm always very invested in what happens with cocoa prices.
AKIKO FUJITA: I think we're in the same camp, Rachelle. We'll have to have another discussion about snacking there.
RACHELLE AKUFFO: Balance is always good. It's interesting to see because we've seen some of the writing on the wall for cocoa prices continuing because we saw some of the issues with drought and some of the biggest cocoa producers in the world. So now, seeing that the cocoa price is continuing to hit historic highs, but, as you mentioned, if you have demand for these products, you have to wonder whether or not people will still be willing to pay these prices as they go up.
For me. I'm in too deep. I'm going to keep spending my money on chocolate. What about you?
AKIKO FUJITA: Yeah. I don't think chocolate is an area where I would ever cut back. But that's just me. That's just us. We will continue to contribute in that way.
RACHELLE AKUFFO: It's true. Sweet for us. But also Hershey raising its quarterly dividend by 15%. Something sweet for investors as well.
