Hershey (NYSE:HSY) posted a dismal earnings report. If lower sales didn’t make it bad, higher material costs and higher marketing costs made it worse. The candy maker posted EPS of $0.27 after items and on a comparable basis posted $0.68 EPS before one-time items. Unfortunately, Wall Street estimates were $0.71 and the same period last year was $0.78. Sales were down 1% to $1.4 Billion, short of the $1.44 Billion estimate.
Shares are indicated down almost 3% at $43.00, and that will qualify it for the 52-week lows and well under the high of $56.75 for the year. This is actually almost 3-year lows. If you’ll recall, Hershey recently lost its CEO who supposedly had trouble managing the company with a dual-class structure.
Maybe some ‘public company structures’ should be changed. Or maybe they just shouldn’t be public. Common stock buyers of Hershey are basically second class citizens.
Jon C. Ogg
October 18, 2007