The Hershey CompanyHSY announced a range of new products and classic treats for Easter. The company is also implementing a few innovations and introducing "spring-inspired packaging".
The company is coming up with a number of egg-shaped products like 'Hershey's Kisses Carrot Cake Candies' and 'Milk Chocolate Covered Marshmallow Egg' along with several Reese's and Cadbury brand food items.
Hershey actively innovates its core brands to meet consumer demand. These efforts are expected to contribute 2-2.5% to sales in 2017.
Notably, the latest line of products is in line with the company's strategy to create a unique and holistic portfolio for every season, which can meet consumers' seasonal shopping needs like gifting and stocking stuffers during the holidays or basket filling and egg hunting during Easter.
The company expects this longer Easter season and planned innovation to boost the top line for Hershey, which has been facing troubles on the revenue front since 2014. Net sales growth of 3.9% in 2014 was below the company's expectations of about 4.8%. Sales declined 0.5% in 2015, also below the company's projections of in-line to slight growth. The top-line weakness continued in 2016 with sales increasing just 0.7%.
The company intends to implement a wide range of innovative and seasonal plans in 2017, which are expected to drive sales.
Share Price Movement
Hershey's shares outperformed the Zacks categorized Food-Confectionary industry in the last one year. The company's shares gained around 16.9% while the broader industry declined 8.4%. The company's productivity improvements and cost-saving initiatives should drive the stock in the upcoming quarters as well.
The company's recent earnings estimates have been encouraging. The current quarter has seen two upward estimate revisions over in the past 60 days while the full-year estimates have seen seven upward revisions over the same time frame.
As a result, the current quarter consensus estimate has risen 2.4% in the past two months, while the full-year estimate has inched 3% higher, justifying the company's Zacks Rank #2 (Buy).
Other Stocks to Consider
All the three companies carry a Zacks Rank #2. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
ConAgra Foods' fiscal 2017 earnings are expected to increase 16.3% while that for J & J Snack Foods are expected to grow 8.1%.
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