McCormick Gears Up For Q4 Print; Here Are The Recent Forecast Changes From Wall Street's Most Accurate Analysts

As McCormick & Company, Incorporated (MKC) prepares to report its fourth-quarter financial results, investors are eager to see how the global leader in flavor will fare. With a mixed bag of analyst upgrades and downgrades, it's essential to examine the recent forecast changes from Wall Street's most accurate analysts. Let's dive into the latest insights and trends that could impact McCormick's stock performance.



Analyst Upgrades and Downgrades

1. TD Cowen analyst Robert Moskow upgraded McCormick's stock from Hold to Buy and raised the price target from $86 to $90 on January 8, 2025. Moskow's upgrade reflects his positive outlook on the company's long-term growth prospects, with an accuracy rate of 67%.
2. Jefferies analyst Rob Dickerson upgraded the stock from Hold to Buy and raised the price target from $85 to $91 on December 9, 2024. Dickerson's upgrade indicates his confidence in McCormick's ability to execute on its growth initiatives and deliver on its long-term objectives, with an accuracy rate of 68%.
3. Argus Research analyst John Staszak upgraded the stock from Hold to Buy with a price target of $88 on April 2, 2024. Staszak's upgrade is based on his positive view of McCormick's broad and advantaged global portfolio, as well as its alignment with consumer trends, with an accuracy rate of 68%.
4. JP Morgan analyst Ken Goldman maintained an Underweight rating and cut the price target from $68 to $66 on January 15, 2025. Goldman's downgrade suggests a bearish sentiment, with concerns about the company's earnings outlook, and an accuracy rate of 76%.

Earnings and Revenue Projections

Analysts expect McCormick to report quarterly earnings at 77 cents per share, down from 85 cents per share in the year-ago period. This represents a decrease of approximately 9.41% in earnings per share compared to the previous year. In terms of revenue, McCormick projects quarterly revenue of $1.77 billion, compared to $1.75 billion a year earlier, indicating an increase of approximately 1.14% in revenue.



Trends in McCormick's Financial Performance

1. Earnings per share: The expected decrease in earnings per share for Q4 2024 compared to Q4 2023 suggests a decline in profitability. However, it is important to note that this decrease is not significant, and the company's earnings per share have been relatively stable over the past year.
2. Revenue: The projected increase in revenue for Q4 2024 compared to Q4 2023 indicates that the company has maintained its sales momentum. This trend is consistent with the company's year-to-date performance, where sales were comparable to the year-ago period, reflecting volume growth of 1% partially offset by price.
3. Gross profit margin: The company's gross profit margin expanded by 170 basis points in the third quarter of 2024 compared to the third quarter of 2023. This expansion was driven by favorable mix and cost savings led by the Company's Comprehensive Continuous Improvement (CCI) program. This trend suggests that the company is effectively managing its costs and improving its profitability.
4. Operating income: McCormick's operating income increased by 15% in the third quarter of 2024 compared to the third quarter of 2023. This increase was driven primarily by gross margin expansion and lower selling, general, and administrative expenses. This trend indicates that the company is successfully executing its growth levers, such as brand marketing, new products and packaging, category management, and proprietary technology.

In conclusion, while McCormick's earnings per share are expected to decrease slightly in Q4 2024 compared to Q4 2023, the company's revenue is projected to increase, and its gross profit margin and operating income have shown improvement. These trends suggest that the company is effectively managing its costs and executing its growth strategies. As investors await McCormick's fourth-quarter financial results, they should consider the mixed bag of analyst upgrades and downgrades, as well as the company's recent financial performance trends, when making investment decisions.