10:58 AM EDT, 10/31/2025 (MT Newswires) -- Hershey (HSY) posted solid Q3 results and raised full-year guidance, but higher brand investment, softer Halloween sales, and near-term margin pressure are likely to weigh on Q4 performance, Morgan Stanley said in a note Thursday.

The firm said higher reinvestment spending and cost inflation will pressure margins in the near term.

Morgan Stanley said cocoa costs could begin to ease into 2026, providing a potential tailwind if realized.

The bank cited continued elasticity risk, commodity price volatility, and reinvestment needs under new leadership as key watch factors affecting the business.

The firm said it expects the stock to remain range-bound until greater clarity emerges on the 2026 outlook.

Morgan Stanley reiterated its equal-weight rating on Hershey and cut its price target to $184 from $193.

Price: 167.46, Change: -3.70, Percent Change: -2.16