30Jun1:03 pmEST

Another Take on the Hershey Buyout

Hershey's stock surged to new all-time highs today on a Wall Street Journal report about a MDLZ buyout bid. 

I suspect Milton Hershey would be proud of the strategy, should the deal go through for a few reasons. MDLZ agreed to change its name to Hershey and keep all of the jobs in Pennsylvania, even moving its own workers to Hershey, PA. 

But beyond that, HSY may finally be selling at a moment when they know input costs may only rise for the foreseeable future. Sugar and cocoa, to name a few major ones have acted better of late, despite both selling off today. Sugar, in particular, has been a superstar among soft commodities. I suspect the HSY leadership took a step back and at least considered that the eight year rolling bear market in soft commodities may be coming to a close. 

Nonetheless, and speculation aside, have a look at a name like TR on the multi-decade chart, below. Tootsie could also see a buyout bid, another perennial takeover rumor. But even if it does not, holding over $35.50 through the summer would be impressive for a massive base breakout. 

I have a few other ideas in this space, which I will run through in my usual Midday Video for Members now. 

Discussing the Morning Actio... Not So Fast, My Friends


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