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COST vs HSY

COST
Costco Wholesale Corporation
NEUTRAL
Price
$996.43
Market Cap
$442.28B
Sector
Consumer Defensive
AI Confidence
80%
HSY
The Hershey Company
NEUTRAL
Price
$179.20
Market Cap
$36.12B
Sector
Consumer Defensive
AI Confidence
72%

Valuation

P/E Ratio
COST
51.82
HSY
26.83
Forward P/E
COST
44.4
HSY
21.33
P/B Ratio
COST
13.78
HSY
7.96
P/S Ratio
COST
1.55
HSY
3.14
EV/EBITDA
COST
32.11
HSY
16.7

Profitability

Gross Margin
COST
12.93%
HSY
37.73%
Operating Margin
COST
3.74%
HSY
13.54%
Profit Margin
COST
2.99%
HSY
11.84%
ROE
COST
29.65%
HSY
31.01%
ROA
COST
8.72%
HSY
9.33%

Growth

Revenue Growth
COST
9.2%
HSY
6.5%
Earnings Growth
COST
13.9%
HSY
-38.2%

Financial Health

Debt/Equity
COST
0.26
HSY
1.26
Current Ratio
COST
1.06
HSY
1.36
Quick Ratio
COST
0.54
HSY
0.66

Dividends

Dividend Yield
COST
0.52%
HSY
3.06%
Payout Ratio
COST
27.04%
HSY
81.91%

AI Verdict

COST NEUTRAL

COST shows neutral fundamentals based on deterministic rules. Financial strength is stable (F-Score 4/9). Mixed signals with both opportunities and risks present.

Strengths
Low debt with D/E ratio of 0.26
Strong ROE of 29.7%
Risks
High valuation with P/E of 51.8
Premium vs Graham Number ($176.89)
Low profit margin of 3.0%
HSY NEUTRAL

Hershey (HSY) trades at a premium valuation with solid profitability and a resilient brand, but faces near-term headwinds reflected in declining earnings and insider selling. Despite a strong quarterly earnings surprise trend over the past two years, YoY EPS has contracted sharply (-44.4%), and operating margins have compressed amid cost pressures. The stock is down 10.8% over 3Y and remains 14% below its 52-week high, though recent 6M performance (+13.9%) suggests stabilization. Relative to peers like KMB and CL, HSY exhibits better growth and lower leverage than most, but its P/E of 26.8x exceeds the sector average of 22.5x and forward P/E of 21.3x offers limited upside given earnings volatility.

Strengths
ROE of 31.01% demonstrates efficient use of equity capital, well above the sector average of 120.59% when excluding outliers like CL (293.63%) and KMB (136.88%)
Consistent earnings beat streak: 3 out of last 4 quarters beat estimates with an average surprise of +16.89%, indicating strong operational execution and conservative guidance
Revenue growth of 6.5% YoY outpaces peer average of 5.46%, showing pricing power and demand resilience in a defensive sector
Risks
Earnings growth collapse: YoY EPS down -38.2%, Q/Q down -38.1%, signaling severe margin pressure or one-time charges that could persist
High P/E ratio of 26.83 vs forward P/E of 21.33 implies significant multiple contraction is priced in, leaving little room for error
Payout ratio of 81.91% is elevated for a company with earnings volatility, raising sustainability concerns if profitability does not rebound

Compare Another Pair

COST vs HSY: Head-to-Head Comparison

This page compares Costco Wholesale Corporation (COST) and The Hershey Company (HSY) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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