Hershey vs. Mondelez: Same Cocoa Problem, Two Very Different Dividends
Both Hershey and Mondelez buy the same cocoa, face the same cost squeeze, and just beat earnings four quarters in a row, yet investors are treating them like completely different assets in 2026. The dividend that survives this commodity cycle…
Should a retirement-focused investor own Hershey (NYSE:HSY | HSY Price Prediction) or Mondelez International (NASDAQ:MDLZ) right now? Both buy the same core input, both flag cocoa cost pressure and tariff uncertainty as key risks, and both just posted a fourth consecutive EPS beat. Investors have already picked a side in 2026. Mondelez is up 13.87% year to date, while Hershey is down 6.53%, including a 10.24% slide over the past month. The real test is which dividend holds up when cocoa bites again.
Yield and Payout Safety: Mondelez Has More Room
Mondelez yields 3.29% on a $2 annual dividend. Hershey pays an annualized forward dividend of $5.808 against a share price of $166.27.
Free cash flow decides this round. Mondelez guides to roughly $3B of 2026 free cash flow, above the $2,487,000,000 it paid in dividends in 2025. It also spent $2.385B on buybacks last year, a buffer it can trim long before impacting the payout.
Hershey’s 2025 was rougher. Its dividend bill of $1,085,296,000 exceeded net income of $883,259,000 as tariff expense of about $160-170M hit. Operating cash flow of $2,277,367,000 kept the dividend funded, and 2026 adjusted EPS guidance of $8.36-$8.52 points to recovery. That is still a forecast, while Mondelez’s coverage is already in hand. Winner: Mondelez.
Dividend Growth and Track Record: Mondelez Kept Raising Through the Crisis
Mondelez lifted its quarterly payout from $0.425 in 2023 to $0.47 in 2024 and $0.50 in 2025, then announced a 4% increase in Q2 2026. Its record shows a higher quarterly amount every year since $0.13 in late 2012, though that followed a cut from $0.29 earlier in 2012.
Hershey’s dividend records run back to 1999, with annual raises from $0.656 in 2017 to $1.192 in 2023. Then the payout sat at $1.37 for every payment from February 2024 through November 2025 before rising to $1.452 in February 2026. When cocoa topped out, Hershey paused; Mondelez kept raising. Winner: Mondelez.
Business Durability: Global Reach Protects the Payout
Hershey’s Q2 revenue of $2.79B leaned on North America Confectionery at $2.17B. It pushed roughly 12 pts of net price through, expanding adjusted gross margin 350 bps to 41.6%, but volume fell about 8 points, North America Confectionery lost share, and International swung to a $5.1M loss. One input, one market, shrinking volume.
Mondelez spreads the risk. Latin America grew 15.1% and AMEA 8.2%, offsetting Europe’s 3.5% organic decline. Adjusted operating margin contracted 120 bps to 13.1%, and hyperinflationary markets add currency risk. Still, the COO said “2027 earnings are expected to be strong, and quite frankly, earnings are insulated from commodity volatility, for us at least.” A beta of 0.402 fits a retiree’s temperament. Winner: Mondelez.
Verdict: Mondelez Wins for Income Investors Near Retirement
Mondelez takes all three rounds. It offers a disclosed 3.29% yield, free cash flow guidance above last year’s dividend bill, and an continuous raise pattern through the worst cocoa squeeze in years. At a forward P/E of 18, retirees are not overpaying for that reliability (if you want more names with the same multi-decade raise pattern, we compared ten such stocks by valuation in a free Dividend Kings report).
Hershey deserves its hearing. Its 10-year return of 123.86% beats Mondelez’s 76.87%, and guidance calls for 32.5%-35% adjusted EPS growth. Total-return investors with a longer runway have a rebound case after the recent selloff.
The conclusion flips if Hershey delivers its guidance and returns to annual raises while Mondelez misses its $3B free cash flow target. Watch for Mondelez’s September 30 ex-dividend date and Hershey’s next earnings report.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
