HSYHershey Company (The)
Is the business good?
The checks split: earnings fully cash-backed (1.6×), but margins compressing.
Operating profit is fully backed by cash. Conversion is improving vs a year ago.
Negative operating leverage, costs are rising faster than sales, squeezing margins as it grows.
A balanced mix of margins, efficiency, and leverage. ROE 26% = margin × turnover × leverage.
Unless marked, from derived.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is HSY?
Hershey Company (The) earns 18% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
Return on invested capital · cost of capital 9.0% · 9.2 points above what the capital costs: growth creates value
- Operating margin
- 18%
Operating margin · Consumer Defensive median 8.1% · 12 months to Q2 2026
- Cash conversion
- 1.59×
Cash conversion · 1.14× a year ago · operating cash flow covers the operating profit after tax
- Gross margin
- 38%
Gross margin
| Year | Operating margin |
|---|---|
| FY2020 | 22% |
| FY2021 | 23% |
| FY2022 | 22% |
| FY2023 | 23% |
| FY2024 | 26% |
| FY2025 | 12% |
Details›
- Gross margin12 months to Q2 2026
- 38%
- Operating margin12 months to Q2 2026
- 18%
- Net margin12 months to Q2 2026
- 12%
- Free cash flow margin
- 18%
- Revenue, trailing twelve months
- $12.2B
- Free cash flow, trailing twelve months
- $2.23B
- Net income, trailing twelve months
- $1.49B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 18%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.
Consumer Defensive
Ranks #24 of 131 by RyuScore