Hershey Media Report 8/25/16

Trade Coverage

1. Have Hershey's Q2 Results Put It Back On Track For FY 2016?

   Aug 24, 2016 | Seeking Alpha

   Brief mentions of Mondelez's bid for Hershey. Relevant portions pasted below.
2. What on Earth are they doing to our chocolate bars?

   Aug 25, 2016 | The Conversation

   By Robert Kneschke
   
   
   Brief mention of Mondelez's bid for Hershey. Relevant portion pasted below.

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Trade Coverage

1. Have Hershey's Q2 Results Put It Back On Track For FY 2016?

   Aug 24, 2016 | Seeking Alpha

   MDLZ bid potential continues to be main catalyst for share price movement, but long-term the company appears well-placed for healthy share price growth.

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   When I reviewed the Q1 2016 results for Hershey's (NYSE:HSY) back in May I noted that it had a pretty rough quarter. Since then a lot has changed. Of course, it received the rejected bid from Mondelez (NASDAQ:MDLZ) which caused its share price to rocket above $110 and pretty much stay there since:

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   Overall, Hershey's continues to impress. Such results are a reminder of why Mondelez thought it attractive to make a snatch for the company. A lot of the prospective movement in Hershey's share price rests on what Mondelez looks to do next. Make another bid? Back away? Who knows. When I reviewed Hershey's fair value back in May (before the Mondelez bid) I came out with a fair value of about $104. Running the same valuation method again with the updated predictions, I come out with a new fair value around $107 (coincidentally, the same as Mondelez's proposed bid price). As such, Hershey's is currently running about 5% ahead of my fair value. Nonetheless, between the strong results seen above and potential for Mondelez to come back with a sweetened bid, I will continue holding Hershey's right now.

   Hershey's long-term growth prospects combined with its strong balance sheet and cash flow characteristics still make it a highly attractive business to own. What is more, their Q2 results also show that they are very much back on track with regards to revenue performance. Mondelez's looming follow-up bid shadow will clearly remain a catalyst for the share price to rise or drop in the near-term, yet Hershey's itself looks well set to generate its own share price appreciation momentum over the longer term. At present that leaves me a happy shareholder indeed.

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2. What on Earth are they doing to our chocolate bars?

   Aug 25, 2016 | The Conversation

   By Robert Kneschke

   This challenge may explain why Mondelez International apparently is seeking to acquire The Hershey Company, bringing together the Cadbury’s, Tobler and Terry’s brands with Hershey and Reece’s.
   

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