Is McCormick & Company's Stock Performing Below Expectations Compared to the Consumer Staples Industry?
Mccormick & Company's Q2 Results and Market Performance
Mccormick & Company, Incorporated (MKC), a Maryland-based company with a market cap of $17.9 billion, has recently reported its Q2 results. The company, recognized for its strong research and development in culinary science and consumer taste trends, markets its products under various brands, including McCormick, French's, Frank's RedHot, Lawry's, Cholula, and Old Bay.
On Jun. 26, shares of MKC surged 5.3% after delivering its Q2 results. The company's overall revenue for Q2 was $1.7 billion, a 1% year-over-year rise that met consensus estimates. MKC's adjusted EPS in Q2 held steady at $0.69, topping analyst expectations by 6.2%.
The company's consumer segment growth, driven by a favorable volume and product mix, was partially offset by declines in sales of its flavor solutions segment. However, MKC's adjusted operating income margin increased by 120 basis points in Q2.
Despite these positive results, MKC has underperformed the Consumer Staples Select Sector SPDR Fund (XLP) over the past 52 weeks and on a YTD basis. The company has slipped 22.5% from its 52-week high of $86.24, reached on Mar. 10. Shares of MKC have also declined 8.4% over the past three months, trading below its 200-day and 50-day moving averages since early April.
MKC has a consensus rating of "Moderate Buy" from the 14 analysts covering the company. The mean price target of $86.07 for MKC suggests a 28.8% premium to its current price levels.
It's worth noting that MKC has outperformed its rival, The Kraft Heinz Company (KHC), which declined 26.6% over the past 52 weeks and 16.2% on a YTD basis.
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As of the publication date, Neharika Jain did not have positions in any of the securities mentioned in this article.
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