03:02 PM EST, 02/03/2025 (MT Newswires) -- Hershey (HSY) may slightly underperform expectations in Q4 driven by the international segment, RBC Capital Markets said in an earnings preview on Monday.

"We are positioned below Street expectations for EPS in 2025 but believe the buyside is generally positioned significantly lower," said RBC analysts, including Nik Modi and Chris Peters.

"While HSY is still trading at ~20x 2025E EPS, we believe

the multiple may decline as expectations for 2025/2026 move lower," they said.

The analysts also said Hershey is facing a tough operating environment on the back of rising cocoa prices.

"While earnings expectations for 2025 have continued to decline, the impact on '25 earnings is hard to determine given that the company provides limited detail regarding its hedging programs," they added.

RBC has a sector perform rating on the stock with a price target of $178.

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