Hunt Valley, Maryland-based McCormick & Company, Incorporated (MKC) is a leader in producing, marketing, and distributing spices, seasoning mixes, condiments, and other flavorful products. With a market capitalization of $21.5 billion, MKC’s brands are familiar to consumers in over 150 countries and territories, showcasing products like Aeroplane Jelly, Billy Bee Honey, Brand Aromatics, and Cholula Hot Sauce.
A company with a valuation exceeding $10 billion is classified as a “large-cap stock,” and MKC fits this definition, highlighting its substantial size and influence in the packaged food industry. The company has built a solid brand reputation and a wide-reaching global network, giving it a competitive advantage. Its varied product lineup serves both consumer and commercial markets, forming a stable base for continual growth and success.
However, MKC has experienced some recent challenges, slipping 6.1% from its 52-week peak of $85.49 achieved on September 16. Over the last three months, MKC’s stock value has decreased by 5%, lagging behind the S&P 500 Index’s ($SPX) 7.4% increase during the same period.
Looking at the longer term, MKC shares have increased 17.4% on a year-to-date basis and 20.1% over the last 52 weeks, although these figures fall short of the S&P 500’s year-to-date gains of 26.9% and annual returns of 28.2%.
In a more positive light, MKC has been trading above its 200-day moving average since late June and has recently maintained a position above its 50-day moving average, signaling potential bullish momentum.
MKC’s recent performance issues are linked to declining demand and a challenging macroeconomic environment in China, which has negatively impacted sales volumes in the Asia-Pacific region. Additionally, the company’s choice to divest its canning division and adjust prices downward has influenced its financial results.
On October 1, MKC shares gained over 2% after the company released its Q3 results, reporting revenue of $1.68 billion, which exceeded Wall Street’s expectations of $1.66 billion. Furthermore, the adjusted earnings per share (EPS) came in at $0.83, surpassing the analysts’ consensus of $0.68. MKC anticipates that the full-year adjusted EPS will be between $2.85 and $2.90.
In comparison, MKC’s competitor, General Mills, Inc. (GIS), has struggled, with a modest 1.2% increase year-to-date and 1.1% gains over the past 52 weeks.
Analysts on Wall Street hold a moderately optimistic view of MKC’s future. The stock receives a “Moderate Buy” rating from the 12 analysts monitoring it, with a mean price target of $86.46, indicating a 7.7% potential upside from current price levels.
On the date of publication,
Neha Panjwani
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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
