Hershey Co (HSY)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 45.62% | 43.60% | 45.32% | 45.42% | 45.36% |
| Operating profit margin | 23.37% | 21.91% | 22.88% | 21.87% | 19.98% |
| Pretax margin | 19.82% | 18.58% | 20.06% | 18.38% | 17.33% |
| Net profit margin | 16.99% | 15.94% | 16.54% | 15.69% | 14.40% |
Over the past five years, Hershey Company has maintained relatively stable gross profit margins, with a slight fluctuation between 43.18% to 45.42%. This indicates the company's ability to effectively manage production costs and generate profit from sales.
The operating profit margin has also shown consistency, generally in the range of 21% to 23% over the same period. This demonstrates Hershey's efficiency in controlling operating expenses and generating profit from its core business activities.
The pretax margin has exhibited some variation, ranging from 17.29% to 20.03%. This metric reflects the company's ability to manage various costs, including interest and taxes, before reaching the bottom line.
Hershey's net profit margin has shown a gradual improvement over the years, ranging from 14.40% to 16.68%. This suggests the company's ability to efficiently convert revenue into net income, indicating overall profitability and effective management of expenses. Overall, Hershey Company's profitability ratios indicate a stable and profitable performance over the past five years.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 21.51% | 20.65% | 19.63% | 19.52% | 19.61% |
| Return on assets (ROA) | 15.64% | 15.02% | 14.19% | 14.00% | 14.12% |
| Return on total capital | 29.58% | 30.97% | 28.08% | 26.12% | 29.14% |
| Return on equity (ROE) | 45.42% | 49.85% | 53.59% | 57.23% | 66.10% |
Hershey Company's profitability ratios have shown a generally positive trend over the past five years. The Operating Return on Assets (Operating ROA) has gradually increased from 19.66% in 2021 to 21.52% in 2023, indicating efficient management of company resources to generate operating income.
Return on Assets (ROA) has also shown improvement, rising from 14.00% in 2020 to 15.64% in 2023, highlighting the company's ability to generate profits relative to its total assets. The Return on Total Capital has exhibited a similar uptrend, reaching 28.74% in 2023, reflecting the high returns earned on both equity and debt capital invested in the company.
Return on Equity (ROE) has fluctuated over the years but generally remained at a high level, indicating strong profitability from shareholder investments. Despite some variability, the ROE has remained above 45% for the past five years, with the highest value of 66.10% in 2019.
Overall, Hershey Company's profitability ratios demonstrate a consistent ability to generate strong returns for both shareholders and overall capital employed in the business, reflecting effective management practices and solid financial performance.