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The week's question
In March 2025, in the thread "Re: OT, out", Umm asked the members: "Do you think it is because America is made up of magical soil that makes businesses based in America magically profitable?" This week it is put to everyone again. The button below opens the small thread re-asking it - read what others have said so far, then give your own answer as an ordinary reply.
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Investment Strategies / Falling Knives
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Author: mungofitch ✹✺ SILVER
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Number: of 1198 
Subject: FKA: HSY
Date: 10/30/23 5:23 AM
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No. of Recommendations: 12
Hershey Company shares closed at $184.11 Friday, in pre-market at $184.00.
A well respected company that falls into that category of "never seems to get cheap".

The business is doing well lately, as usual.
The stock price has tanked recently, down by more than half since May, and it is now as cheap as its cheapest in ages, a hair under 20 times trailing earnings.
I think the last time it was cheaper on that metric was in 1999 due to a one-time gain of some sort, haven't looked into it.

As an aside, I think the general dumping of junk food companies because of fears of falling sales from appetite control drugs is hilarious.

If this is a firm that you have always wanted to own (a feeling I have had), this certainly seems like a better time than most.
And the straight line 50% drop since May certainly qualifies as falling knife behaviour. It might fall more, but my hunch is that the 2-3 year returns from here will be pleasant.

Jim

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This community has written 1,188 posts about Falling Knives. The article-length ones it recommended most:
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