Hunt Valley, Maryland-based McCormick & Company, Incorporated (MKC) manufactures, sells, and distributes spices, seasoning mixes, condiments, and other flavorful products. Valued at $20.6 billion by market cap, the company supplies its products under McCormick, French’s, Frank’s RedHot, Cholula Hot Sauce, and OLD BAY brands in the Americas brands.
Shares of this global leader in flavor have underperformed the broader market over the past year. MKC has gained 18.4% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 22.3%. In 2025, MKC stock is up marginally, compared to SPX’s 4% rise on a YTD basis.
Narrowing the focus, MKC’s outperformance is apparent compared to First Trust Nasdaq Food & Beverage ETF (FTXG). The exchange-traded fund has declined about 4% over the past year. Moreover, MKC’s marginal returns on a YTD basis outshine the ETF’s 3.1% losses over the same time frame.
MKC’s underperformance is driven by lower sales in China, rising operational costs, currency fluctuations, and ongoing inflationary pressures, further exacerbated by economic and geopolitical disruptions that have strained its supply chain, affecting product availability. Additionally, the company’s decision to discontinue low-margin operations and sell its canning business has reduced the volume throughout 2024. Moreover, the company is facing challenges from a fragile consumer spending environment, with increased value-seeking behavior potentially slowing growth in its higher-margin product categories.
On Jan. 23, MKC shares closed up more than 2% after reporting its Q4 results. Its adjusted EPS of $0.80 surpassed Wall Street expectations of $0.77. The company’s revenue was $1.80 billion, beating Wall Street forecasts of $1.77 billion. For fiscal 2025, MKC expects its adjusted EPS to be between $3.03 and $3.08.
For fiscal 2025, ending in November, analysts expect MKC’s EPS to grow 4.1% to $3.07 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.
Among the 12 analysts covering MKC stock, the consensus is a “Moderate Buy.” That’s based on seven “Strong Buy” ratings, four “Holds,” and one “Strong Sell.”
This configuration is more bullish than two months ago, with six analysts suggesting a “Strong Buy.”
On Jan. 27, Barclays PLC (BCS) kept an “Equal-Weight” rating on MKC and lowered the price target to $82, implying a potential upside of 6.5% from current levels.
The mean price target of $84.31 represents a 9.6% premium to MKC’s current price levels. The Street-high price target of $96 suggests an upside potential of 24.7%.
