An Investment in Hershey’s Stock Looks Sweeter Than Ever

Hershey’s (NYSE:HSYbecame an attractive investment last year when the COVID-driven sell-off resulted in ultra-low prices for this consumer staple. The company was not only well-positioned to weather the storm internal efforts to reposition the portfolio for longer-term sustainable growth were beginning to pay off. Over the past year, the company has finalized three major divestitures that have it in leaner shape, with a healthier balance sheet, and accelerating business.

Hershey’s, A Triple-Dip Of Good News

Hershey’s reported a very solid quarter despite headwinds related to divestitures and FX. Divestitures and FX resulted in a 0.2% and 0.4% headwind to the topline results with the takeaway being these headwinds are largely behind the company. That said, the $2.19 in reported consolidated revenue is 5.8% higher than last year and beat the consensus by 330 basis points. The gains were made on a 6.3% increase in organic sales due to a 5.75% increase in volume and a 0.6% increase in pricing. The U.S. segment was strongest with a bain of 9.06% while International saw its sales fall 13.1%.

Moving down the report, the company’s volume increase and internal efforts resulted in a significant increase in both the growth and operating margins. At the operating level, the GAAP margin increased by 470 basis points to 18.5% while the adjusted margin widened 170 basis points to 19.6% and both ahead of the consensus. The increase in revenue and margin resulted in earnings leverage and adjusted EPS of $1.49 or $0.06 better than expected.

“We delivered a strong quarter with continued share gains and volume growth to finish the year.   While the impact of key external factors on our business remains uncertain, we have good momentum going into 2021 with visibility into a strong start to the year.  We anticipate we will deliver another year of balanced sales and earnings growth in 2021,” said Michele Buck, The Hershey Company President, and Chief Executive Officer.

If the first dip of good news is the earnings beat, and the second the company’s increasing margins and earnings leverage, the third is the guidance. The company was among the first to reinstate guidance at the end of the calendar 3rd quarter 2020 and it has upped that guidance now. The company’s new projection has F2021 revenue growth in the range of 2-4% versus the previously expected 2.0% and a more robust 6-8% increase in EPS versus the $4.54 previously announced.

Hershey’s Dividend Is The Sprinkles On Top

If accelerating business, improving profitability, and earnings leverage aren’t enough to get you interested in Hershy there is also the dividend to consider. The company pays about 2.2% in yield with shares near $147 and there is a high expectation of future distribution increases. The company is paying about 48% of its earnings but that is based on a consensus figure well-below current guidance. The company’s earnings picture is backed up by a very healthy balance sheet as well, one that carries a moderate amount of cash and debt has good coverage and ample FCF. If the company follows true to form the next increase will come in later summer and could be worth as much as 10% of the current payout.

The Technical Outlook: Hershey’s Is Struggling With Resistance

Shares of Hershey’s popped on the news but resistance at the short-term moving average threatens to keep price action range-bound or moving lower. If price action cannot get above the 30 EMA a retest of the $144 level or lower becomes the most likely scenario. If, however, the bulls can rally and get above the EMA a move up to $152 or $153 looks probable.

By: Thomas Hughes

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Here’s Why Stocks Are At Record Highs Following The Capitol Chaos In DC

  • The Dow Jones Industrial Average closed at an all-time high on Wednesday and reached an intraday record on Thursday, despite pro-Trump insurrectionists violently storming the Capitol and disrupting the confirmation of President-elect Joe Biden’s victory.
  • The bullish mood on Wall Street has less to do with the riots and more to do with Democrats winning Georgia’s Senate runoff elections and taking control of Congress.
  • Stocks hinge on the prospects of corporate profit growth. The soft Democratic majority in the Senate lifts Biden’s chances of passing the fiscal stimulus that experts have urged Congress to enact for months.
  • A $1 trillion relief package could “easily” boost GDP expansion in 2021 by 1 point to 6%, Michelle Meyer, the head of US economics at Bank of America, said. That would all but certainly lift investors’ hopes for near-term profit growth.
  • Visit the Business Insider homepage for more stories.

While pro-Trump insurrectionists remained illegally perched on the steps of the US Capitol on Wednesday, the Dow Jones Industrial Average closed at a record high.

The market uptick has little to do with violence on Capitol Hill. Instead of fearing the chaos and President Donald Trump’s rhetoric, investors kept their sights set on Georgia’s runoff outcomes.

Raphael Warnock and Jon Ossoff’s victories in the Senate races push Democrats’ seat count in the body to 50, allowing for Vice President-elect Kamala Harris to break any ties. The soft majority paves the way for President-elect Joe Biden to pass more progressive policy, including fiscal relief meant to drive the US out of the coronavirus recession.

Stocks move – and always have moved – on the prospects of expanding corporate profits. Experts on Wall Street, at universities, and in the Federal Reserve have spent months telling Congress that sweeping fiscal stimulus is necessary to drive a faster and more equitable economic recovery. Climbing stock prices reflect investors’ beliefs that following Democrats’ wins in Georgia, such a relief package is more likely to reach Biden’s desk. 

Another round of stimulus would be a game changer for economic growth and accelerate the rebound to pre-pandemic levels of activity, Michelle Meyer, the head of US economics at Bank of America, said in a Thursday note. The package would likely prioritize another round of direct payments, an extension of federal unemployment benefits, funds for state and local governments, and relief for healthcare workers.

A $1 trillion relief package could “easily” boost gross domestic product growth in 2021 by 1 percentage point to roughly 6%, according to the bank. The positive economic effect could be even larger, as the estimates hinge on conservative spending multipliers, Meyer added.

Economists at Morgan Stanley and Goldman Sachs similarly linked optimistic GDP projections to Democrats’ wins in Georgia. Credit Suisse raised its S&P 500 forecast on Thursday, saying the increased likelihood of new stimulus in early 2021 could drive the index 12% higher through the year.

Concerns that the Washington riots would create a lasting risk were largely alleviated Thursday morning. Congress certified Biden’s victory after hours of debate and failed efforts to object to Electoral College vote counts. Trump pledged to conduct “an orderly transition” soon after, reversing from previous claims that he won the election and would remain in office.

The ensuring of a peaceful transition further augmented bullish sentiments. All three major stock indexes notched record intraday highs on Thursday as investors viewed the certification as a return to business as usual.

“With the political tensions easing, more stimulus expected to help boost the economy, and coronavirus vaccines helping bring a measure of calm to investors and traders, it seems that the market can now focus on earnings season,” JJ Kinahan, the chief market strategist at TD Ameritrade, said.

By: Ben Winck

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Dan Takahashi – English Channel

TWITTER: https://twitter.com/Dan_Takahashi_ INSTAGRAM: https://www.instagram.com/dantakahashi1/ FACEBOOK: https://www.facebook.com/DanTakahashiJP/ LINKEDIN: https://www.linkedin.com/in/dan-takah… I’m building a new company and recruiting team members who live in Tokyo! If you meet the criteria, please email daniel@dkocapital.net with your (1)experience and (2)education background! ■ Software engineer (1), development of iOS or Android Social Media & Business News App, over 2 years experience ■ Software engineer (2), development of iOS or Android Investing App, over 2 years of experience ■ Attorney, specialized in Japanese Financial Instruments and Exchange Law, more than 5 years of experience ■ Quants analyst, investing algorithm development, more than 3 years of experience ■ Portfolio Manager, asset management of large fund, over 5 years experience ■ Professor from Top Japan Univeristy, specializing in finance, more than 5 years of experience ■ Previous Important Videos! Create a Long Term Investment Portfolio? https://youtu.be/Vdwx4z0rJ-g Short Term Investing….Key is to Find the Trend? https://youtu.be/TMLWUjlb_wU Top ETFs for your portfolio? https://youtu.be/Yfv3PvPKeuM AVOID Leverage & Inverse ETFs? https://youtu.be/tDoQgr1OLf8 3 Secrets to CUTTING LOSSES? https://youtu.be/KA8vIaaEXYI ■ Chart Technical analysis Videos RSI – https://youtu.be/plpR2HOWyM4 BOLLINGER BAND – https://youtu.be/Hkn2F3pJyuc MACD – Find the Trend? https://youtu.be/nNt5s8PwjkQ Pivot Point Analysis – https://youtu.be/aQWotA5yT7A ■ Media Inquires please Contact: daniel@dkocapital.net ■ Dan Takahashi Profile ・560k total Followers (bit over 6 months) ・Cornell University, Honors Magna Cum Laude ・Entrepreneur, Investor, Media Commentator Born in Tokyo, half-Japanese, half-American. Have lived in 6 countries and visited over 60 countries! Started investing at 12 years old, began Wall Street when 19, created hedge fund when 26, and sold company stake at 30 years old. I love nato beans & karaoke ❤❗ ■ Japanese Channel https://www.youtube.com/channel/UCFXl…#stockmarket#dantakahashi#investing

US Stocks Climb Higher In First Trading Session of 2021

  • US stocks climbed higher in the first trading session of 2021 on Monday as investors returned from the New Year holiday.
  • Bitcoin saw a volatile trading session on Monday after it fell 17% following a surge to record highs just below $35,000.
  • Watch major indexes update live here.

US stocks gained in the first trading session of 2021 on Monday as investors returned from the New Year holiday.

Bitcoin surged and then dropped in a volatile trading session. The popular cryptocurrency hit record highs just below $35,000 on Sunday before falling as much as 17% in Monday trades to levels not seen since last week. Bitcoin’s fall was its steepest since March. 

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Monday:

Read more: GOLDMAN SACHS: Buy these 37 stocks that could earn you the strongest returns without taking on big risks in 2021 as the recovery and vaccine distribution get underway

Tesla jumped 3% after it said it delivered nearly 500,000 electric vehicles in 2020, besting Wall Street expectations and falling just a few hundred vehicles short of its delivery target.

Nio was following in Tesla’s footsteps after it reported record December and fourth quarter delivery numbers. The stock jumped as much as 5% in Monday trades.

Herbalife fell in Monday trades after billionaire investor Carl Icahn sold $600 million worth of shares in the company and gave up board seats.

Oil prices were mixed. West Texas Intermediate crude dropped 0.33%, to $48.36 per barrel. Brent crude, oil’s international benchmark, rose 0.14%, to $51.87 per barrel.

Gold jumped 2.69%, to $1,946.10 per ounce.

By: Matthew Fox

Read more: The space industry will grow by over $1 trillion in the next decade, says Bank of America. Here are the 14 stocks best-positioned to benefit from the boom.SEE ALSO:Warren Buffett’s right-hand man shapes his investing approach and keeps him disciplined, ‘Shark Tank’ star Kevin O’Leary says »READ NOW:Herbalife slides after Carl Icahn sells $600 million of stock in the company »

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Capital.com 88.6K subscribers Watch our detailed S&P 500 forecast 2021 and see where the stock market will be headed throughout the coming year. Despite all the economic turmoil that this year has brought to the world, 2020 has actually been stellar for the stock market, and many further growth for S&P 500 in 2021. So much so that many analysts have already predicted more double digit gains in their SP500 index forecast. The distribution of new COVID-19 vaccines is largely what is considered to be a strong driver for the SP500 analysis 2021 due to the lasting economic recovery that it implies.

In fact, JPMorgan Chase has even stated that these are among the best conditions for sustained gains in years as far as the SP500 outlook 2021 goes. With that in mind, all the most prominent projections for the SP500 target 2021 range from 3,800 to 4,200. And some of these SP500 estimates 2021 are even fairly modest, as they don’t all consider a positive vaccine outcome. And if the results of the vaccine do prove positive, then there’s room for even more upside in the SP500 forecast. Hence, for SP500 investing, 2021 may actually prove to be the best year in history. But there’s also another take on the SP500 prediction 2021, which we will cover in today’s video. Stay tuned for our full SP500 forecast 2021.

And find out what the SP500 futures forecast has in store for the coming weeks. Have your own SP 500 futures forecast 2021 in mind? Let us know in the comments! Give us a thumbs up if you liked our “SP 500 Technical Analysis 2021” video, and leave us a comment down below with your thoughts on the current market situation. And for the latest updates on the SP 500 forecast analysis 2021, be sure to subscribe to the Capital.com channel! #SP500#SP500Forecast#SP500Futures

Stock Market Crash: The End Game And Down The Rabbit Hole

For a stock market to crash, prices must fall. That is obvious. But what if stocks rise and the value of money falls? Is that a crash? If the value of money drops 30% but the market rises a little, is that a bull market?

Not many people would argue against the premise that it is the Federal Reserve’s liquidity actions that have levitated the U.S. stock market. Sadly, in an attempt to keep the whole economy from imploding it has inflated stock asset values to ridiculous levels. Jay Powell, the Fed Chairman, made it clear in a recent interview that they were committed to supporting the U.S. economy and to protecting it from the effects of anti-Covid measures, for as long as necessary and for as much as needed, and clearly indicated that would be for a long time.

This is the trend of that Federal Reserve support:

The Federal Reserve's total assets
The Federal Reserve’s total assets Credit: Federal Reserve

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(Chart courtesy of the Federal Reserve’s website)

This QE or however you want to brand this liquidity provision (liquidity equals cash, provision equals printing assets that turn into money) is clearly going to run and run for a long time because every time the Fed slackens its swapping of fresh government-backed quality assets for other people’s sketchier assets, down flops the stock market and then up pops more QE to keep the market from crashing Hindenburg-like in flames.

When the Fed tapered in 2019, down went the market and crash went peripheral global economies as U.S. dollars were sucked from the global economic plumbing. The U.S. and the world economy is hooked on the Federal Reserve’s money printing. By swapping golden government debt for other parties’ riskier, perhaps very risky, debt the Fed yanks the world’s dodgy assets holders out of the mire by their hair, thus avoiding a spiral of insolvency. The potential damage of that terrifying comeuppance is what sparks all bailouts, allowing broken companies and economies to stagger on, most likely towards even greater fragility.

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The weird thing is this: If these liquidity operations keep going on, the Federal Reserve will in effect own all its citizens’ homes and all its creditworthy (and not so creditworthy) corporate debt and thus have liens on most of the economic assets of its citizens and producers. It will have in effect nationalized, though probably by accident, the country, having bought it with government paper. 

However, if it brings this process to a halt the market will crash and everyone will instantly be a lot poorer, while if it carries on at some point it will glut the market for its paper, up will go interest rates and down will go the value of bonds and the reality of a much poorer economy will bite.

However, it seems that the Federal Reserve is not going to let the stock market crash whatever the outcome.

But if a dollar in 2023 or 2024 buys significantly less and the market hasn’t rocketed accordingly, you are getting your reset in a chronic way rather than through an acute event of a 30% retrenchment on your portfolio. This will be the aim, once again to smooth the process by spreading it out over a decade or two rather than take the pain in an awful three or so years of restructuring.

Yet make no mistake, the U.S. stock market is a house of cards, and as the Malaysians discovered when they propped up the price of tin, there is a finite nature to keeping a market away from its natural equilibrium and you must spend increasing amounts to do it. At some point you run out of credit and down goes the market to its correct level.

How long the U.S. can continue to debase its credit while maintaining its credibility is the key question in this ongoing drama and every country in its time has gone beyond that point and sunk into crisis. If the U.S. chooses to corner its markets, that time will approach rapidly. With continued QE the system will become more fragile still so to the catalyst needed to breach that fixed market corner will get smaller and smaller until the slightest of nudges will break the spell.

Inflation solves all these problems as it gives the flexibility for economic activity to rebalance as few can keep up with all the different developing prices. It creates impetus for people to get their money moving and crushes debt with negative real interest rates and also stealthily rebalances the actual value of those debts. Switching inflation on and off is a known, even though central banks ludicrously claim otherwise.

But will the stock market crash now? Hearing Jay Powell speak it appears they are prepared to die on the hill of QE. So the market will not be allowed to take its natural course. This means the market will crash but only when and if there is a downfall moment. There has to be a readjustment for a global economy that has lost at least 10% of its output with still more damage to come.

Some governments will aim for a chronic economic development while some will go for an acute one if they can shift its blame onto someone or something else.

As such, investors should pray that the new incoming U.S. administration doesn’t find a neat scapegoat to blame a reset on, to get that out of the way early in their term.

For anyone who is not a diehard buy and holder, the near future must be one where an investor’s fingers should stay hovering near that sell button because the tightrope walk the Fed is walking for the sake of the U.S. and world economy is going to be a precarious one.

Clem Chambers is the CEO of private investors website ADVFN.com and author of 101 Ways to Pick Stock Market Winners and Trading Cryptocurrencies: A Beginner’s Guide.

Chambers won Journalist of the Year in the Business Market Commentary category in the State Street U.K. Institutional Press Awards in 2018. Follow me on Twitter or LinkedIn. Check out my website.

Clem Chambers

 Clem Chambers

I am the CEO of stocks and investment website ADVFN . As well as running Europe and South America’s leading financial market website I am a prolific financial writer. I wrote a stock column for WIRED – which described me as a ‘Market Maven’ – and am a regular columnist for numerous financial publications around the world. I have written for titles including: Working Money, Active Trader, SFO and Technical Analysis of Stocks & Commodities in the US and have written for pretty much every UK national newspaper. In the last few years I have become a financial thriller writer and have just had my first non-fiction title published: 101 ways to pick stock market winners. Find me here on US Amazon. You’ll also see me regularly on CNBC, CNN, SKY, Business News Network and the BBC giving my take on the markets.

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George Gammon

Stock market crashes and the 👉QUESTION ON YOUR MIND IS 👈..Are we now in the “end game?” This has been the fastest stock market crash, as measured by a 10% decline from a market high, in history. Worst week since 2008 global financial crisis. As we all know, the system now is much more levered and precarious. So what happens now? Does the stock market crash further? Is this the next 2008 style financial crisis? Will this lead to a recession or even a depression?

These are the questions everyone has, and they’re the questions I’ve been asking myself. In this video I’ll do my best to outline the systemic risks in the current system, why the federal reserve doesn’t have as much control as people think, and why this maybe the black swan event people have been expecting. If you’re interested in the future of the economy THIS IS A MUST WATCH VIDEO!

In this stock market crash end game video I’ll discuss the following: 1. The current systemic risks. 2. Jeff Snider’s work showing the Fed isn’t in control. 3. Is this the end game? I give you my opinion and what is the deciding factor for me. Link to Peter Schiff video from clip. Peter is one of my favorites, I’d strongly recommend checking out his channel and podcast! https://youtu.be/NjzYRtK6i_M For more content that’ll help you build wealth and thrive in a world of out of control central banks and big governments check out the videos below! 👇 🔴 Subscribe for more free YouTube tips: https://www.youtube.com/channel/UCpvy… Do you wanna see another video as incredible as this? Watch “Kyle Bass Predicts HSBC Collapse In 2020! (Here’s Why)”: https://youtu.be/QwjiIIht0bw Watch “Repo Market Bailout: TERRIFYING Unintended Consequences Revealed!”: https://youtu.be/-2wJWzoSjRo Watch “2008 GFC: Everything You Know Is Wrong! (Truth Revealed)”: https://youtu.be/Ku58GQ5dcKU#StocksPlummet#MarketChaos#GettingWorse?

Credit Suisse Bullish On Stocks In 2021 Because It’s Bullish On 2022

NEW YORK, NEW YORK – JULY 23: People walk along Broadway as they pass the Wall Street Charging Bull statue on July 23, 2020 in New York City. On Wednesday July 22, the market had its best day in 6 weeks. (Photo by Michael M. Santiago/Getty Images)

Credit Suisse analyst Jonathan Golub introduced his 2021 price target for the S&P 500 (^GSPC) of 4,050, implying 12.2% upside from Tuesday’s closing levels. Underpinning this upbeat call is his assumption that two years from now, the post-virus economic recovery will have already hit a peak.

“Our 2021 forecasts are designed to answer a simple question: what will the future (2022) look like in the future (end of 2021),” Golub said in a new note Wednesday. “From this perspective, we are forced to de-emphasize the near-term, focusing instead on the return to a more normal world.”

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“As we look toward 2022, the virus will be a fading memory, the economy robust, but decelerating, the yield curve steeper and volatility lower, and the rotation into cyclicals largely behind us,” he added.

Based on Golub’s analysis, economic activity as measured by GDP growth will renormalize at levels slightly above trend, or with quarterly annualized growth rates just over 3%, starting in the second half of 2021.

And the labor market — which as of October was still 10 million payrolls short of pre-pandemic levels — will likely reach “full employment” by the second half of 2022, Golub added.

Since the stock market discounts future events, each of these prospects for further improvement down the line should translate into a higher S&P 500 as investors price in these events.

Analysts have already begun to account for an anticipated improvement in corporate profits, as S&P 500 earnings per share (EPS) have on aggregate sharply topped consensus expectations so far for each of second and third quarter results this year.

“We expect 2020 estimates to rise, 2021 to remain stable and 2022 to moderate,” Golub said.

His 2021 S&P 500 price target of 4,050 is based on earnings per share of $168 next year, for an improvement of 20% over the expected aggregate EPS this year. He expects EPS will then rise to $190 in 2022.

Sector leadership

On a sector basis, Golub rates technology stocks as Overweight for 2021, given their “faster sales growth, superior margins, robust FCF [free cash flow], and low leverage. He also rated financials, one of the laggard sectors so far for the year-to-date, as Overweight, given their propensity to lead during recoveries.

“Consistent with a typical recovery, banks should benefit from improving credit conditions, increasing transaction volumes, and a steepening yield curve,” Golub said. “The group is adequately reserved, likely. resulting in a greater return of capital.”

Golub designated cyclicals with a Neutral rating for next year, saying he is “positively inclined toward economically-sensitive groups and believe[s] their momentum should persist over the near-term.” But he added that he thinks the largest quarter-over-quarter improvements in economic activity have already come and gone, leaving more tepid further upside potential for stocks with profits closely tethered to economic growth.

He rated non-cylicals like consumer staples as underweight, while giving health care specifically an Overweight rating.

“Non-cylicals should lag in an improving economy as falling volatility supports higher P/Es (price-earnings multiples) for riskier assets, and rising rates make their high dividend yields less appealing,” he said. “The one exception is health care, which should outperform given a more robust earnings trend.”

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

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Credit Suisse’s Mandy Xu warns that investors are piling into value stocks at their own peril. With CNBC’s Melissa Lee and the Fast Money traders, Guy Adami, Tim Seymour, Karen Finerman and Steve Grasso. For access to live and exclusive video from CNBC subscribe to CNBC PRO: https://cnb.cx/2JdMwO7 » Subscribe to CNBC TV: https://cnb.cx/SubscribeCNBCtelevision » Subscribe to CNBC: https://cnb.cx/SubscribeCNBC » Subscribe to CNBC Classic: https://cnb.cx/SubscribeCNBCclassic Turn to CNBC TV for the latest stock market news and analysis. From market futures to live price updates CNBC is the leader in business news worldwide. Connect with CNBC News Online Get the latest news: http://www.cnbc.com/ Follow CNBC on LinkedIn: https://cnb.cx/LinkedInCNBC Follow CNBC News on Facebook: https://cnb.cx/LikeCNBC Follow CNBC News on Twitter: https://cnb.cx/FollowCNBC Follow CNBC News on Instagram: https://cnb.cx/InstagramCNBC#CNBC#CNBC TV

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