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Mondelēz Stock Is Scaling New Heights: What’s Driving It?

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Jun. 24 2019, Published 1:50 p.m. ET

Stock performance

Shares of Mondelēz International (MDLZ) are scaling new heights thanks to its stellar gains so far this year. Mondelēz stock is up 38.0% on a YTD (year-to-date) basis, and it closed at $55.25—just a shade lower than its 52-week high of $55.71—on June 21.

The continued momentum in Mondelēz’s base business has been driven by balanced growth in volumes and pricing. Its ability to contain costs and expand its margins is also encouraging. Mondelēz’s profit margins have improved in the past several quarters while the majority of packaged food companies have struggled to safeguard their margins amid significant cost headwinds.

Mondelēz’s focus on broadening its well-being snacks portfolio through innovations, acquisitions, and strong earnings growth in the past several quarters has further driven its stock to record highs.

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Peers’ performances

The stocks of most packaged food companies have outperformed the broader markets so far this year thanks to their focus on expanding their growth avenues, including pet foods, frozen foods, and well-being snacks.

The stocks of Conagra Brands (CAG), General Mills (GIS), the J.M. Smucker Company (SJM), the Hershey Company (HSY), and the Campbell Soup Company (CPB) are up 34.5%, 38.1%, 30.0%, 27.9%, and 23.3%, respectively, YTD. Meanwhile, the S&P 500 is up 17.7% YTD.

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