Opinions Kash Pashootan
KellogKCOMMENTApr 16, 2015
Stock price when the opinion was issued
As of Dec 10, 2025. Market Open.
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Last summer, they announced spinning off their cereal business from it snacking business. However, packaged foods stocks have fallen out of fashion. Investors don't want recession stocks like this. So, K has hit 52-week lows despite delivering a strong quarter and raised their full-year forecast last week. Strong brands have withstood higher product prices.
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Premium contentKellogg Company strives to enrich and delight the world through foods and brands that matter. Company's beloved brands include Pringles®, Cheez-It®, Special K®, Kellogg's Frosted Flakes®, Pop-Tarts®, Kellogg's Corn Flakes®, Rice Krispies®, Eggo®, Mini-Wheats®, Kashi®,RXBAR®, MorningStar Farms® and more. Net sales in 2019 were approximately $13.6 billion, comprised principally of snacks and convenience foods like cereal and frozen foods. Kellogg brands are beloved in markets around the world. Kellogg is also a company with Heart & Soul, committed to creating Better Days for 3 billion people by the end of 2030 through our Kellogg's® Better Days global purpose platform. Social media mentions are up 200% in the past 24h.
Premium contentKellogg Company strives to enrich and delight the world through foods and brands that matter. Company's beloved brands include Pringles®, Cheez-It®, Special K®, Kellogg's Frosted Flakes®, Pop-Tarts®, Kellogg's Corn Flakes®, Rice Krispies®, Eggo®, Mini-Wheats®, Kashi®,RXBAR®, MorningStar Farms® and more. Net sales in 2019 were approximately $13.6 billion, comprised principally of snacks and convenience foods like cereal and frozen foods. Kellogg brands are beloved in markets around the world. Kellogg is also a company with Heart & Soul, committed to creating Better Days for 3 billion people by the end of 2030 through our Kellogg's® Better Days global purpose platform. Social media mentions are up 300% in the past 24h.
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They took over Pringles last year. This whole space has been extremely challenged. They struggle to grow and particularly in the cereal space. They are having trouble because people's' preferences have changed. There are higher raw materials costs. We are moving away from snacks as well as cereals. Some of these tried to attract investors with high returns of capital. In fact they are just giving back your own capital and not producing enough to cover these big dividends. We should see it 12% lower next year.
General Mills (GIS-N) or Kellogg’s (K-N)? Primarily focused on what he considers junk food. The consumer has become more educated. His concern with this company is that they have not adapted to the healthy consumer preference. Put up almost $2 billion in debt a few years ago to buy Pringle. If you look at the cash flow that goes to servicing that debt and their dividend, there isn’t a lot of cash for new growth catalysts. General Mills would be his preferred play.