MKC - McCormick & Company Stock Isn't Cheap But It Is Undervalued | Benzinga
McCormick & Company (NYSE: MKC) stock may not be cheap, trading at 22X this year's and 20X next year's earnings, but it is undervalued. The company is among the highest-quality consumer staples on the market, trading below its historical norms and near the middle of the group's range. Because the company's leaning toward growth and margin improvement produces results, the rebound will likely continue and may gain momentum.
Among the catalysts for this market are the analysts. The analysts have yet to issue revisions to their outlook, but they are coming because the group grossly underestimated McCormick's positioning and the impact of its efforts.
The consensus rating fell to Reduce from Hold over the last year, and the price target was cut by 6% because of fears growth would slow and earnings power evaporate. Now, with growth still in the forecast and margin widening, it is likely that revisions will be positive and may include significant upgrades and price target revisions. As it is, the consensus aligns with the post-release price surge and may cap gains in the near term.
McCormick Outpaced Consensus and Guided Higher; Share Prices Followed
McCormick & Company had a solid quarter with top-line growth ...