Piper Sandler Upgrades Hershey as Cocoa Pressures Ease

Piper Sandler upgraded The Hershey Company (NYSE: HSY) to Overweight from Neutral and raised its price target to $213.00 from $193.00. Shares rose more than 1% in pre-market trading on Wednesday.

The firm said easing cocoa costs, which it no longer expected to be inflationary in 2026, along with the removal of cocoa tariffs, provided Hershey with increased flexibility to reinvest in growth while expanding earnings. Piper noted that early cocoa cost benefits had been allocated toward growth initiatives such as better-for-you offerings, salty snacks, international expansion, sweets, and premium products, allowing tariff relief to flow through to the bottom line.

Growth from these investments was expected to support a more compelling long-term growth narrative. Piper Sandler said it saw upside to estimates but maintained conservative projections of $7.23 EPS for 2026 and $7.73 EPS for 2027. The firm also modeled increasing cash generation and raised its valuation multiple to 27.5x 2027 EPS, up from 25.0x previously.