McCormick & Co Inc (MKC, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $62.53, McCormick & Co Inc has witnessed a daily loss of 3.13%, marked against a three-month change of -25.85%. A thorough analysis, underlined by the GF Score, suggests that McCormick & Co Inc is well-positioned for substantial growth in the near future.
Decoding the GF Score
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
McCormick & Co Inc's GF Score components are as follows:
- Financial strength rank: 5/10
- Profitability rank: 9/10
- Growth rank: 9/10
- GF Value rank: 9/10
- Momentum rank: 7/10
Each one of these components is ranked and the ranks also have positive correlation with the long term performances of stocks. The GF score is calculated using the five key aspects of analysis. Through backtesting, we know that each of these key aspects has a different impact on the stock price performance. Thus, they are weighted differently when calculating the total score. With high ranks in profitability, growth, and GF value, and a decent momentum rank, GuruFocus assigned McCormick & Co Inc the GF Score of 92 out of 100, which signals the highest outperformance potential.
Understanding McCormick & Co Inc's Business
With a market cap of $16.77 billion and sales of $6.61 billion, McCormick & Co Inc operates with a margin of 15.01%. In its more-than 130-year history, McCormick has grown to become the leading global manufacturer, marketer, and distributor of spices, herbs, extracts, seasonings, and other flavorings. Beyond end consumers, McCormick's customer base also includes top quick-service restaurants, retail grocery chains, and other packaged food and beverage manufacturers. Its reach is global, with nearly 40% of sales generated beyond its home turf to include 150 other countries and territories. In addition to its namesake brand, the firm's portfolio includes Old Bay, Zatarain's, Thai Kitchen, Frank's RedHot, French's, and the Cholula brand.
Profitability Rank Breakdown
The Profitability Rank shows McCormick & Co Inc's impressive standing among its peers in generating profit. The Piotroski F-Score confirms McCormick & Co Inc's solid financial situation based on Joseph Piotroski's nine-point scale, which measures a company's profitability, funding and operating efficiency. McCormick & Co Inc's strong Predictability Rank of 5.0 stars out of five underscores its consistent operational performance, providing investors with increased confidence.
Growth Rank Breakdown
Ranked highly in Growth, McCormick & Co Inc demonstrates a strong commitment to expanding its business. The company's 3-Year Revenue Growth Rate is 5.6%, which outperforms worse than 53.42% of 1711 companies in the Consumer Packaged Goods industry. Moreover, McCormick & Co Inc has seen a robust increase in its earnings before interest, taxes, depreciation, and amortization (EBITDA) over the past few years. Specifically, the three-year growth rate stands at 0.3, and the rate over the past five years is 5.6. This trend accentuates the company's continued capability to drive growth.
Conclusion
Given McCormick & Co Inc's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. This analysis underscores the importance of comprehensive financial evaluation in making informed investment decisions. GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
