Nestlé vs Hershey Which Is More Favorable?

Nestlé and Hershey are two of the biggest players in the global confectionery industry, both renowned for their iconic brands and long-standing market presence. Nestlé, a Swiss multinational conglomerate, boasts a diverse portfolio of products beyond just chocolates, while Hershey, an American company, is synonymous with classic treats like Reese's and Hershey's bars. Investors often compare and contrast the performance of Nestlé and Hershey stocks, analyzing factors such as revenue growth, profitability, and competitive positioning in the ever-evolving sweet treats market.

Nestlé or Hershey?

When comparing Nestlé and Hershey, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Nestlé and Hershey.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Nestlé has a dividend yield of 4.07%, while Hershey has a dividend yield of 2.99%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Nestlé reports a 5-year dividend growth of 4.73% year and a payout ratio of 69.76%. On the other hand, Hershey reports a 5-year dividend growth of 10.09% year and a payout ratio of 59.32%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Nestlé P/E ratio at 17.42 and Hershey's P/E ratio at 20.91. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Nestlé P/B ratio is 5.94 while Hershey's P/B ratio is 8.82.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Nestlé has seen a 5-year revenue growth of 0.16%, while Hershey's is 0.47%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Nestlé's ROE at 32.67% and Hershey's ROE at 43.20%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $83.75 for Nestlé and $181.69 for Hershey. Over the past year, Nestlé's prices ranged from $83.66 to $117.55, with a yearly change of 40.51%. Hershey's prices fluctuated between $168.16 and $211.92, with a yearly change of 26.02%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.