Is McCormick (MKC) stock a good buy?

This is a step-by-step stock review to answer the question, is McCormick (MKC) stock a good buy?

This article will teach you how to use the 4Ms of investing. This will be a detailed walkthrough to show you how the 4Ms work and why they are important. If you are interested, you can log into Tykr to use the 4M Confidence Booster (Powered by OpenAI) which will allow you to complete a 4M Analysis in less than 60 seconds.

What are the 4Ms?

  • MOS (Margin of Safety) – The MOS is the math part of investing which includes the Summary, Score, and MOS (Margin of Safety).
  • Meaning – The meaning is the business model and how scalable the revenue streams are.
  • Moat – The moat is how the business compares to other companies in the same Sector and Industry.
  • Management – The management is the track record of the CEO.

What 4M score are we going for?

  • 80-100 = High confidence – Yay! You should have high confidence buying this stock. It passes all 4M!
  • 60-79 = Moderate confidence – Alert! There may be better stocks in the market. Only buy this stock if you truly believe the company will improve!
  • 0-59 = Low confidence – Warning! There are better stocks in the market. Due to the low score, you should consider looking at other stocks.

Table of Contents

The following links will direct you to key topics to help answer the question, is McCormick (MKC) stock a good buy?

  1. McCormick Company History
  2. MOS
  3. Meaning
  4. Moat
  5. Management
  6. 4M Score
  7. Is McCormick (MKC) stock a good buy?

1. McCormick Company History

  • Founded in 1889: McCormick & Company was established in Baltimore, Maryland, by Willoughby McCormick as a spice and flavoring business.
  • Early Growth: The company initially focused on selling spices and herbs in bulk to grocers and food manufacturers.
  • Expansion: In the early 20th century, McCormick began expanding its product lines and distribution, becoming a well-known brand in consumer kitchens.
  • Public Listing: McCormick went public on the New York Stock Exchange in 1925, facilitating its growth and development.
  • Acquisitions: The company has acquired several brands over the decades, including Zatarain’s, Frank’s RedHot, and Old Bay, broadening its product offerings.
  • Global Reach: McCormick expanded internationally, establishing a strong presence in various markets around the world.
  • Recent Focus: McCormick continues to innovate with new product lines and sustainability initiatives, focusing on delivering high-quality spices and flavors to consumers and food professionals globally.

2. MOS (Margin Of Safety)

When investing in a company, the first step is to look at the financials. Fortunately, Tykr does this for us automatically. The higher the score, the stronger the financials and the safer the investment. The higher the MOS, the higher the potential returns you can make.

  • Summary: Overpriced
  • Score: 45
  • MOS: 1%

To see the most up-to-date Summary, Score, and MOS, please log into Tykr.

3. Meaning

When investing in a company, it’s important to know how a company makes money. A mature business model has multiple streams of revenue which allow the company to weather downturns in the economy.

Here is how McCormick makes money:

  • Spice and Herb Sales: McCormick earns money by selling a wide range of spices and herbs to consumers and food manufacturers.
  • Seasoning Blends: Revenue comes from selling seasoning blends and flavoring products used in cooking and food preparation.
  • Retail Products: The company profits from its branded retail products, including McCormick, Lawry’s, and Ducros.
  • Food Service: McCormick generates income by supplying spices and seasonings to restaurants, foodservice companies, and other commercial customers.
  • International Sales: Revenue is boosted by selling products in international markets, expanding its global footprint.
  • Acquisitions: McCormick increases its earnings through strategic acquisitions of other food brands and seasoning companies.
Here are a few of the other companies that McCormick has acquired over the years. This is important because a company will use a “Buy before build” philosophy to go to market faster and add additional streams of revenue. A company with more revenue streams has a more stable business model. Keep in mind, that most companies don’t build new software because it takes too long to go to market and generate revenue.
  • Lawry’s
  • Ducros
  • Zatarain’s
  • French’s
  • Old Bay

4. Moat

When investing in a company, it’s important to understand how a company ranks against other companies in the same sector and industry. Based on the Score, here is how McCormick stacks up against other companies.

  1. BellRing Brands, Inc.(BRBR) – 73
  2. Lamb Weston Holdings, Inc.(LW) – 72
  3. BRF S.A.(BRFS) – 67
  4. Darling Ingredients Inc.(DAR) – 67
  5. Ingredion Incorporated.(INGR) – 67
  6. McCormick & Company, Incorporated.(MKC) – 45

To see the most up-to-date Summary, Score, and MOS and each stock, please log into Tykr.

5. Management

When investing in a company, it’s important to understand who the CEO is, what they have accomplished in the past, and how they have helped this company grow. Good leaders typically have stronger cultures, less turnover, and better returns in the stock market.

  • Leadership Transition: Brendan Foley became CEO of McCormick’s consumer business in 2022, overseeing the company’s strategic direction and operations.
  • Integration of Acquisitions: He played a key role in integrating major acquisitions, including the purchase of the French’s and Frank’s RedHot brands.
  • Innovation and Product Development: Foley advanced McCormick’s innovation strategy, focusing on new product development and expanding the company’s product offerings.
  • Operational Efficiency: He implemented initiatives to enhance operational efficiency and streamline supply chain processes.
  • Sustainability Initiatives: Foley supported sustainability goals, including efforts to improve environmental practices and responsible sourcing within McCormick’s supply chain.
  • Revenue Growth: Under his leadership, McCormick saw continued revenue growth and strengthened its market position in the global spice and flavoring industry.

6. 4M Score

All of our homework on this company leads up to the 4M Score. A lot of investors only look at the numbers. Yes, it’s important to look at the first M (MOS) which is the math part of investing but it’s also important to look past the numbers and also look at the Meaning, Moat, and Management. If all 4Ms pass, we should have high confidence in buying this stock.

What 4M score are we going for?

  • 80-100 = High confidence – Yay! You should have high confidence buying this stock. It passes all 4M!
  • 60-79 = Moderate confidence – Alert! There may be better stocks in the market. Only buy this stock if you truly believe the company will improve!
  • 0-59 = Low confidence – Warning! There are better stocks in the market. Due to the low score, you should consider looking at other stocks.

👉 The 4M Score of McCormick (MKC) (AYX) is 49/100.

To see the most up-to-date 4M Score, please log into Tykr.

7. Is McCormick (MKC) stock a good buy?

Some of the top questions investors can have is McCormick (MKC) stock a good buy or should I buy McCormick (MKC) stock?

Investing in McCormick & Company (MKC) offers a generally positive outlook with several compelling reasons for consideration. McCormick, a leader in the spice and flavoring industry, benefits from a strong market position and a broad, diverse product portfolio that includes well-known brands like Lawry’s and French’s. The company has a history of steady revenue growth and consistent profitability, supported by strategic acquisitions such as the purchase of the French’s and Frank’s RedHot brands, which enhance its market presence.

Additionally, McCormick’s focus on innovation and sustainability, including efforts to improve environmental practices and responsible sourcing, aligns with current consumer and investor priorities. However, potential investors should be mindful of risks such as fluctuating commodity prices and supply chain challenges, which could impact profitability.

Overall, McCormick presents a solid investment opportunity for those seeking stability and growth in the consumer goods sector, though attention to market conditions and operational risks is essential.

To truly know if McCormick is a good stock to buy or sell, we recommend you log into Tykr. Within seconds you can see the Summary, Score, MOS, and 4M Score.

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