Stock Analysis | Mondelez Outlook - Weak Technicals, Mixed Analysts, and a Mixed Bag of Fundamental Signs

Market Snapshot

Takeaway: Mondelez (MDLZ) is underperforming with a 10.20% price decline over the past five days and weak technical signals suggesting a bearish outlook.

News Highlights

Recent news affecting Mondelez includes:

• U.S. FDA revoking outdated food standards: On July 16, the FDA announced it would eliminate 52 food identity standards. This could affect how food products are regulated, potentially reducing compliance costs for companies like Mondelez.
• Brazil seeks U.S. tariff exemptions: The Brazilian government is pushing to exclude Embraer aircraft and certain food products from a proposed 50% U.S. tariff set to take effect on August 1. This could impact international trade dynamics in the food sector.
• Global food ingredients market on track to grow: A recent report projects the global food ingredients market will grow to USD 567.09 billion by 2034 from USD 351.48 billion in 2024, signaling continued demand for Mondelez’s products.

Analyst Views & Fundamentals

Mondelez is facing a mixed bag of analyst views and fundamental indicators.

Analyst Ratings

• Average rating score (simple mean): 3.86
• Weighted rating score (performance-weighted): 2.22
• Rating consistency: Analysts are divided, with ratings ranging from "Strong Buy" to "Neutral".
• Price trend vs. ratings: The current price trend (down -10.20%) aligns with the more bearish, performance-weighted rating (2.22), suggesting market skepticism.

Fundamental Factors

Here are key fundamental values and their internal diagnostic scores (0-10):

• ROE (Annualized): 7.85% — Score: 3
• Net profit margin: 5.74% — Score: 1
• EV/EBIT: 72.58 — Score: 1
• Net assets per share growth: -0.93% — Score: 2
• ROA: 1.48% — Score: 2
• Annualized net profit margin on total assets: 3.01% — Score: 3
• Profit-MV: -0.68 — Score: 2

While Mondelez maintains decent returns on equity and assets, its net profit margin and EV/EBIT metrics are underperforming. The mixed scores reflect a company with some solid fundamentals but also areas of concern.

Money-Flow Trends

Mondelez has seen mixed money-flow activity over the past five days:

• Big-money (block) flow: 41.75% of all inflow — trend is negative.
• Retail (small) flow: 50.28% of all inflow — trend is positive.
• Large-cap institutional flow: 51.34% of inflow — trend is positive.
• Extra-large institutional flow: 40.11% of inflow — trend is negative.

Overall, big money is pulling back while retail and some large money flows remain positive. This divergence may suggest conflicting views between institutional and retail investors.

Key Technical Signals

Technically, Mondelez is in a weak position with five bearish indicators and no bullish ones. Here's a breakdown of recent signals:

Internal Diagnostic Scores (0-10)

• WR Overbought: Score: 1.31
• WR Oversold: Score: 3.26
• Dividend Announcement Date: Score: 1.00
• MACD Death Cross: Score: 3.72
• Earnings Release Date: Score: 4.24
• RSI Oversold: Score: 3.79

Recent Indicator Activity by Date

• July 25: WR Overbought
• July 30: WR Oversold, MACD Death Cross
• July 31: WR Oversold, RSI Oversold

This indicates a pattern of overbought and oversold conditions clashing, which is a sign of volatility and unclear momentum. The key technical insight is that the stock is showing signs of weakness and should be approached with caution.

Conclusion

Mondelez is caught in a tough spot with weak technicals, mixed analyst views, and a fundamental profile that's both strong and problematic. Investors may want to consider waiting for a pull-back or a clearer reversal signal before entering or adding to positions. Given the bearish technical outlook, it may be prudent to monitor upcoming earnings and earnings expectations closely for signs of stabilization.