Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Credit

<ul><li>Hershey finished 2021 on a highly positive note with a double-digit growth in the top-line as well as broad-based category growth.</li><li>The company has carried out the relevant pricing actions to deal with inflation and interestingly, saw a depletion in the inventory.</li><li>Hershey is actively expanding its headcount and has amplified its recruiting efforts to successfully manage expansion across 2022.</li></ul>

Hershey finished 2021 on a highly positive note with a double-digit growth in the top-line as well as broad-based category growth.The company has carried out the relevant pricing actions to deal with inflation and interestingly, saw a depletion in the inventory.Hershey is actively expanding its headcount and has amplified its recruiting efforts to successfully manage expansion across 2022.

The Hershey Company: Detailed Credit Analysis & Financial Strength Evaluation Report

Equity Capital Markets

<ul><li>Hershey reported a decent performance and double-digit growth in the last year with a broad-based category growth.</li><li>The company has carried out adequate pricing actions to deal with inflation and interestingly, saw a depletion in the inventory.</li><li>It is interesting to add that over the past couple of years, Hershey has gradually grown its capital expenditure which bodes well for the management’s expansion plans.</li></ul>

Hershey reported a decent performance and double-digit growth in the last year with a broad-based category growth.The company has carried out adequate pricing actions to deal with inflation and interestingly, saw a depletion in the inventory.It is interesting to add that over the past couple of years, Hershey has gradually grown its capital expenditure which bodes well for the management’s expansion plans.

The Hershey Company: Financial & Price Forecasts

<ul><li>Hershey has been on a strong bull run and is already trading close to its 52-week high after a fairly decent result.</li><li>The management remains committed to investing in its brands and overcoming the supply chain challenges to meet the strong demand for its offerings.</li><li>Hershey also has a strong margin profile with gross margin above 40% and operating margin around the 24% mark so the impact of inflationary pressure is easy to absorb.</li></ul>

Hershey has been on a strong bull run and is already trading close to its 52-week high after a fairly decent result.The management remains committed to investing in its brands and overcoming the supply chain challenges to meet the strong demand for its offerings.Hershey also has a strong margin profile with gross margin above 40% and operating margin around the 24% mark so the impact of inflationary pressure is easy to absorb.

<ul><li>Hershey Co experienced a strong second quarter with 15% organic sales growth and is extremely close to our target price.</li><li>Hershey has experienced a sustained level of at-home consumption trend as well as recovery in away-from-home consumption which is a major green flag.</li><li>While the company might face inflationary pressures, its buyout-based growth strategy could help scale the organization rapidly.</li></ul>

Hershey Co experienced a strong second quarter with 15% organic sales growth and is extremely close to our target price.Hershey has experienced a sustained level of at-home consumption trend as well as recovery in away-from-home consumption which is a major green flag.While the company might face inflationary pressures, its buyout-based growth strategy could help scale the organization rapidly.

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Thematic (Sector/Industry)

Allocations in Consumer Staples stocks are at decade-long lows.  Average fund weights among active Global managers stand at 7.65% following an aggressive slump after the onset of COVID-19 in early 2020.The spread between Consumer Discretionary weights and Consumer Staples weights in active Global portfolios is close to it's all-time wides, but is turning lower after peaking in April this this year.What stands out in our data is the cutting back of Consumer Staples allocations by Growth investors, with a number of high profile stocks cut from Aggressive Growth portfolios since last 2019 (<a href="https://www.smartkarma.com/entities/reckitt-benckiser-group-plc" target="_blank" data-smartkarma-citation="entities:22105:1" rel="noopener">Reckitt Benckiser (RB/ LN)</a>, <a href="https://www.smartkarma.com/entities/colgate-palmolive-co" target="_blank" data-smartkarma-citation="entities:15093:1" rel="noopener">Colgate Palmolive Co (CL US),</a><a href="https://www.smartkarma.com/entities/anheuser-busch-inbev-sa-nv" target="_blank" data-smartkarma-citation="entities:865:1" rel="noopener">Anheuser Busch Inbev Sa/Nv (ABI BB)</a> )For the Consumer Staples sector to see a turnaround, perhaps growth, or at least the perception of growth needs to return for these investors.

Allocations in Consumer Staples stocks are at decade-long lows.  Average fund weights among active Global managers stand at 7.65% following an aggressive slump after the onset of COVID-19 in early 2020.The spread between Consumer Discretionary weights and Consumer Staples weights in active Global portfolios is close to it's all-time wides, but is turning lower after peaking in April this this year.What stands out in our data is the cutting back of Consumer Staples allocations by Growth investors, with a number of high profile stocks cut from Aggressive Growth portfolios since last 2019 (Reckitt Benckiser (RB/ LN), Colgate Palmolive Co (CL US),Anheuser Busch Inbev Sa/Nv (ABI BB) )For the Consumer Staples sector to see a turnaround, perhaps growth, or at least the perception of growth needs to return for these investors.

Global Consumer Staples: Allocations at Rock Bottom as Growth Investors Flee

United States

The Hershey Company manufactures chocolate and sugar confectionery products. The Company's principal products include chocolate and sugar confectionery products; gum and mint refreshment products; and pantry items, such as baking ingredients, toppings and beverages.

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Hershey Co/The (HSY US)

The Hershey Company: Detailed Credit Analysis & Financial Strength Evaluation Report

Hershey finished 2021 on a highly positive note with a double-digit growth in the top-line as well as broad-based category growth. The company has...

Baptista Research

The Hershey Company: Financial & Price Forecasts

Hershey reported a decent performance and double-digit growth in the last year with a broad-based category growth. The company has carried out...

Baptista Research

Hershey Co - Investment Thesis

Hershey has been on a strong bull run and is already trading close to its 52-week high after a fairly decent result. The management remains...

Baptista Research

Hershey Co - Investment Thesis

Hershey Co experienced a strong second quarter with 15% organic sales growth and is extremely close to our target price. Hershey has experienced a...

Baptista Research

Global Consumer Staples: Allocations at Rock Bottom as Growth Investors Flee

Allocations in Consumer Staples stocks are at decade-long lows. Average fund weights among active Global managers stand at 7.65% following an...

Steven Holden

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