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The Weekly Buzzing Stocks by Billy Kawasaki
McCormick & Co
MKC-N
TOP PICK
Jun 29, 2023
$86.780
Stock price when the opinion was issued
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BUY
As the economy reopened, shares slid, but shares stabilized last month as the market became volatile. They reported last week some hot sales, but management cut their full-year earnings forecast because of supply chain issues and higher transportation and packaging costs. If these issues can be solved, then MKC would be a terrific buy.
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DON'T BUY
Usually it thrives during a slowdown. Their June report slashed full-year guidance, as consumer goods struggle in Europe and Asia. Also, MKF raised prices and consumers didn't bite. Management still needs to get its house in order; they has slashed their full-year-forecast, forecasting $0.65 EPS vs. $0.83 by Wall Street. Full-year, the company projects 0 to -2% sales growth, down from before. Are still struggling from the supply chain.
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HOLD
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research
MKC has a market cap of $21B, a yield of 2.2%, historically low to mid-single digit sales and earnings growth rates, and forward earnings margin estimates are quite positive. Its balance sheet is strong, free cash flows are healthy, and its debt levels have been coming down over the years. Over the past 20 years, it has a roughly 10% total return CAGR, and while it has largely been flat over the past several years, we feel that in the coming years it can help an investors' portfolio with downside protection. We would be comfortable holding, or slowly averaging into MKC here.
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McCormick & company, incorporated (nyse: mkc) is a global leader in flavor and one of the most respected and familiar names in the industry. in business for more than 125 years, mccormick manufactures, markets and distributes spices, seasoning mixes, condiments and other flavorful products to the entire food industry—retail outlets, food manufacturers and food service businesses. the mccormick name represents a trusted source of flavor in millions of kitchens around the globe—in homes and in restaurants.