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The Hershey Company HSY has announced plans to acquire LesserEvil, a fast-growing brand known for organic and flavorful snacks. This deal aligns with Hershey’s strategy of expanding beyond its iconic sweets into the better-for-you snacking space. By adding LesserEvil to its portfolio, Hershey is doubling down on its commitment to meet changing consumer preferences. The deal is still subject to regulatory approval and is expected to be closed later this year.
Hershey’s Push to Dominate the Snack Market
Hershey has been steadily growing its snack portfolio, and acquiring LesserEvil is a strategic step in that expansion. The company already owns top confectionery brands like Hershey’s, Reese’s and Jolly Ranchers, along with fast-growing salty snack brands such as SkinnyPop, Dot’s Homestyle Pretzels and Pirate’s Booty. LesserEvil’s focus on bold flavors and clean ingredients makes it a strong addition to this lineup.
This acquisition will help Hershey broaden its better-for-you snack offerings while introducing new product categories and formats to appeal to a wider audience. Additionally, LesserEvil’s manufacturing capabilities will enhance production efficiency and support Hershey’s growth in the competitive snack market. As consumer demand shifts toward healthier snacking options, Hershey’s investment in LesserEvil marks another major step in balancing its legacy of sweets with modern snacking trends.
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What Else Should You Know About HSY?
Hershey is undergoing a major transformation to drive long-term growth by streamlining operations and improving efficiency. It is strengthening its marketing strategy to better align with consumer trends and integrate its supply chain across confectionery and salty snacks. By leveraging a new Enterprise Resource Planning system, the company aims to boost scalability and performance. Its pricing strategy also focuses on managing rising raw material costs, helping to sustain profitability despite market challenges.
Hershey faces significant headwinds from high cocoa prices, shifting consumer spending habits and increased competition from emerging brands. Declining market share in everyday chocolate, weaker convenience store sales and the rise of discount and online shopping channels are hampering growth. In addition, tighter inventory management by retailers is affecting sales in both confectionery and salty snack categories, adding further challenges for the Zacks Rank #4 (Sell) company.
Wrapping Up
As consumers embrace healthier snacking, Hershey’s proposed acquisition of LesserEvil reinforces its commitment to evolving beyond traditional confectionery. Balancing its legacy of sweets with modern trends, the company must now navigate market challenges and shifting consumer preferences to sustain long-term growth.
The company’s shares have lost 11% in the past three months compared with the industry’s 9% decline.