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McCormick Stock: Analysts’ Recommendations

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Analysts remain on the sidelines

Numerous analysts increased their target price on McCormick (MKC) stock following the company’s stronger-than-expected bottom-line performance. UBS increased its target price to $146 from $130. Stifel raised its target price to $145 from $130. Jefferies increased the target price to $165 from $150.

Despite the target price hike, most of the analysts still recommend a “hold” on McCormick stock. McCormick’s top and bottom-line growth are expected to stay low as the company faces a tough YoY (year-over-year) comparison. Currency volatility and the higher tax rate remain a drag on sales earnings.

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McCormick’s sales and EPS in the previous year benefited from its acquisition of RB Foods. In the absence of incremental benefits from RB Foods, McCormick’s top and bottom-line growth slowed down. However, sustained momentum in the base business continues to drive the company’s sales and earnings growth.

Rating and target price

Among the 11 analysts, nine recommended a “hold,” while two recommended a “buy.” Analysts have a target price of $146.90 per share, which indicates a downside of 2.9% based on the company’s closing price of $151.21 on April 2.

Analysts also maintained a “hold” on General Mills (GIS) and J.M. Smucker (SJM) shares. Analysts suggested a “buy” on Conagra Brands (CAG) stock.

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