Wells Fargo Upgrades The Hershey Company To Outperform

Well Fargo has published a research report on The Hershey Company

and has upgraded the company to Outperform from Market Perform. In the report, Wells Fargo writes "We are upgrading shares of Hershey to Outperform from Market Perform and are raising our 12-month valuation range to $55-57 from $49-51. We believe that Hershey's investments in consumer marketing, selling capabilities, and innovation over the past several years position the company for better-than-expected top and bottom line growth over the next few years. We are raising our 2011 EPS estimate to $2.82 from $2.76 (versus $2.76 consensus) and our 2012 estimate to $3.10 from $3.00 (versus $2.98 consensus) as a result. We believe that Hershey has among the strongest and highest visibility top line and bottom line growth prospects within our packaged food coverage. The U.S. chocolate confection category continues to grow in excess of its historical 3-4% per year rate, and Hershey's share is up modestly in tracked channels. We believe Hershey should have solid top line momentum in H1 2011 driven by the 50-60% increase in advertising spending in 2010 and the December launch of new products such as Hershey's Drops and Reese's Minis." The Hershey Company closed yesterday at $48.79.