Bullish Case: Hershey's brand strength and innovative product lines signal potential recovery amidst ongoing operational improvements and seasonal demand spikes, driving price back up.

Bearish Case: Lingering reputational issues, coupled with high cocoa costs, may strain Hershey's profit margins, leading to further declines in stock performance amidst market volatility.

Potential Outcomes:

1. 40% - Positive earnings report boosts stock due to consumer interest.

2. 30% - Reputational damage from controversies leads to a sales decline.

3. 20% - Continued cost pressures from cocoa affect profitability.

4. 10% - Unexpected macroeconomic changes adversely impact the market.

Trading Oracle: Consider a bullish strategy by selling $172.5 puts and buying $167.5 puts, targeting a shorter expiration. This plays into HSY's potential upside while capitalizing on lower implied volatility and market resilience, aiming for a strong reward:risk profile with a 78% probability of profit.

November 21, 2024