The Hershey Company (NYSE:HSY) has been performing well over the past year and the company is optimistic that trend won't change, even with the rollout of coronavirus vaccines and people's lives potentially going back to normal later this year.
Many food manufacturers have done well because consumers having been spending more time at home and eating in, but Hershey is optimistic it will still do well even if that isn't the case.
The company released its quarterly results on April 29 and sales of $2.3 billion for the period ending April 4 were up 12.7% year over year. The results are encouraging enough that the company upgraded its guidance for 2021.
Previously, Hershey was projecting its net sales to rise between 2% and 4% this year. Now, however, it is anticipating revenue growth between 4% and 6%. It forecasts that earnings per share will also grow by as much as 12% in 2021.
Although the company expects higher input costs to drive down some of its profitability, it believes that will be offset by higher volumes due to more merchandising opportunities and incremental distribution, presumably as the economy continues to open back up and get back to normal.
Year to date, shares of Hershey are up more than 11%, slightly less than the S&P 500's gains of 13%. And with a dividend yield of around 1.9%, investors can also benefit from the stock's above-average payout.
Over the years, Hershey has been a fairly stable investment, averaging a beta of around 0.35, suggesting that it is far less volatile than the markets. For long-term investors, Hershey could be a great dividend stock to add today.
