MCCORMICK & CO-NON VTG SHRS (MKC) Stock Fundamental Analysis
NYSE:MKC - New York Stock Exchange, Inc. - US5797802064 - Common Stock - Currency: USD
MKC gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 90 industry peers in the Food Products industry. MKC has an excellent profitability rating, but there are concerns on its financial health. MKC is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
MKC had positive earnings in the past year.
MKC had a positive operating cash flow in the past year.
Each year in the past 5 years MKC has been profitable.
MKC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of MKC (6.08%) is better than 75.56% of its industry peers.
MKC has a Return On Equity of 14.47%. This is in the better half of the industry: MKC outperforms 80.00% of its industry peers.
MKC's Return On Invested Capital of 8.13% is fine compared to the rest of the industry. MKC outperforms 76.67% of its industry peers.
MKC had an Average Return On Invested Capital over the past 3 years of 7.52%. This is in line with the industry average of 7.59%.
The 3 year average ROIC (7.52%) for MKC is below the current ROIC(8.13%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.08% | ||
| ROE | 14.47% | ||
| ROIC | 8.13% |
ROA(3y)5.51%
ROA(5y)5.71%
ROE(3y)14.31%
ROE(5y)15.82%
ROIC(3y)7.52%
ROIC(5y)7.83%
1.3 Margins
MKC's Profit Margin of 11.67% is amongst the best of the industry. MKC outperforms 88.89% of its industry peers.
In the last couple of years the Profit Margin of MKC has declined.
Looking at the Operating Margin, with a value of 15.72%, MKC belongs to the top of the industry, outperforming 90.00% of the companies in the same industry.
MKC's Operating Margin has declined in the last couple of years.
MKC has a Gross Margin of 38.59%. This is amongst the best in the industry. MKC outperforms 86.67% of its industry peers.
In the last couple of years the Gross Margin of MKC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.72% | ||
| PM (TTM) | 11.67% | ||
| GM | 38.59% |
OM growth 3Y-3%
OM growth 5Y-2.76%
PM growth 3Y-0.64%
PM growth 5Y-2.25%
GM growth 3Y-0.95%
GM growth 5Y-0.8%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), MKC is destroying value.
MKC has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, MKC has more shares outstanding
MKC has a better debt/assets ratio than last year.
2.2 Solvency
MKC has an Altman-Z score of 2.68. This is not the best score and indicates that MKC is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of MKC (2.68) is better than 66.67% of its industry peers.
MKC has a debt to FCF ratio of 6.64. This is a slightly negative value and a sign of low solvency as MKC would need 6.64 years to pay back of all of its debts.
MKC's Debt to FCF ratio of 6.64 is fine compared to the rest of the industry. MKC outperforms 72.22% of its industry peers.
A Debt/Equity ratio of 0.66 indicates that MKC is somewhat dependend on debt financing.
The Debt to Equity ratio of MKC (0.66) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | 6.64 | ||
| Altman-Z | 2.68 |
ROIC/WACC0.83
WACC9.81%
2.3 Liquidity
MKC has a Current Ratio of 0.65. This is a bad value and indicates that MKC is not financially healthy enough and could expect problems in meeting its short term obligations.
MKC has a worse Current ratio (0.65) than 86.67% of its industry peers.
A Quick Ratio of 0.25 indicates that MKC may have some problems paying its short term obligations.
MKC's Quick ratio of 0.25 is on the low side compared to the rest of the industry. MKC is outperformed by 93.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.65 | ||
| Quick Ratio | 0.25 |
3. Growth
3.1 Past
MKC shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.96%.
The Earnings Per Share has been growing slightly by 1.98% on average over the past years.
MKC shows a small growth in Revenue. In the last year, the Revenue has grown by 0.40%.
The Revenue has been growing slightly by 4.69% on average over the past years.
EPS 1Y (TTM)6.96%
EPS 3Y-1.11%
EPS 5Y1.98%
EPS Q2Q%-4.76%
Revenue 1Y (TTM)0.4%
Revenue growth 3Y2.1%
Revenue growth 5Y4.69%
Sales Q2Q%0.17%
3.2 Future
The Earnings Per Share is expected to grow by 6.51% on average over the next years.
Based on estimates for the next years, MKC will show a small growth in Revenue. The Revenue will grow by 3.19% on average per year.
EPS Next Y4.18%
EPS Next 2Y6.41%
EPS Next 3Y7.19%
EPS Next 5Y6.51%
Revenue Next Year1.74%
Revenue Next 2Y2.61%
Revenue Next 3Y3.02%
Revenue Next 5Y3.19%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 26.57 indicates a quite expensive valuation of MKC.
The rest of the industry has a similar Price/Earnings ratio as MKC.
When comparing the Price/Earnings ratio of MKC to the average of the S&P500 Index (26.86), we can say MKC is valued inline with the index average.
A Price/Forward Earnings ratio of 23.22 indicates a rather expensive valuation of MKC.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MKC is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.43, MKC is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.57 | ||
| Fwd PE | 23.22 |
4.2 Price Multiples
MKC's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of MKC is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.05 | ||
| EV/EBITDA | 18.44 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates MKC does not grow enough to justify the current Price/Earnings ratio.
MKC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)6.36
PEG (5Y)13.44
EPS Next 2Y6.41%
EPS Next 3Y7.19%
5. Dividend
5.1 Amount
MKC has a Yearly Dividend Yield of 2.46%.
MKC's Dividend Yield is a higher than the industry average which is at 4.69.
MKC's Dividend Yield is comparable with the S&P500 average which is at 2.43.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.46% |
5.2 History
The dividend of MKC is nicely growing with an annual growth rate of 8.09%!
MKC has been paying a dividend for at least 10 years, so it has a reliable track record.
MKC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)8.09%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
58.49% of the earnings are spent on dividend by MKC. This is a bit on the high side, but may be sustainable.
The dividend of MKC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP58.49%
EPS Next 2Y6.41%
EPS Next 3Y7.19%
77.57
+3.93 (+5.34%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners90.35%
Inst Owner Change0.66%
Ins Owners0.01%
Ins Owner Change11.19%
Market Cap20.80B
Analysts72
Price Target85.85 (10.67%)
Short Float %2.01%
Short Ratio2.18
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.46% |
Yearly Dividend1.68
Dividend Growth(5Y)8.09%
DP58.49%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-2.26%
Min EPS beat(2)-7.59%
Max EPS beat(2)3.07%
EPS beat(4)3
Avg EPS beat(4)8.31%
Min EPS beat(4)-7.59%
Max EPS beat(4)21.3%
EPS beat(8)6
Avg EPS beat(8)6.23%
EPS beat(12)7
Avg EPS beat(12)0.9%
EPS beat(16)11
Avg EPS beat(16)2.3%
Revenue beat(2)1
Avg Revenue beat(2)-0.5%
Min Revenue beat(2)-1.38%
Max Revenue beat(2)0.39%
Revenue beat(4)1
Avg Revenue beat(4)-0.38%
Min Revenue beat(4)-1.38%
Max Revenue beat(4)0.39%
Revenue beat(8)2
Avg Revenue beat(8)-0.75%
Revenue beat(12)3
Avg Revenue beat(12)-1.44%
Revenue beat(16)5
Avg Revenue beat(16)-0.61%
PT rev (1m)-0.77%
PT rev (3m)-0.76%
EPS NQ rev (1m)-0.41%
EPS NQ rev (3m)-2.83%
EPS NY rev (1m)-0.12%
EPS NY rev (3m)-0.77%
Revenue NQ rev (1m)-0.06%
Revenue NQ rev (3m)-0.24%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-0.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.57 | ||
| Fwd PE | 23.22 | ||
| P/S | 3.09 | ||
| P/FCF | 32.05 | ||
| P/OCF | 23.14 | ||
| P/B | 3.84 | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.44 |
EPS(TTM)2.92
EY3.76%
EPS(NY)3.34
Fwd EY4.31%
FCF(TTM)2.42
FCFY3.12%
OCF(TTM)3.35
OCFY4.32%
SpS25.08
BVpS20.22
TBVpS-11.53
PEG (NY)6.36
PEG (5Y)13.44
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.08% | ||
| ROE | 14.47% | ||
| ROCE | 10.79% | ||
| ROIC | 8.13% | ||
| ROICexc | 8.21% | ||
| ROICexgc | 50.89% | ||
| OM | 15.72% | ||
| PM (TTM) | 11.67% | ||
| GM | 38.59% | ||
| FCFM | 9.65% |
ROA(3y)5.51%
ROA(5y)5.71%
ROE(3y)14.31%
ROE(5y)15.82%
ROIC(3y)7.52%
ROIC(5y)7.83%
ROICexc(3y)7.68%
ROICexc(5y)8.06%
ROICexgc(3y)53.77%
ROICexgc(5y)64.53%
ROCE(3y)10.15%
ROCE(5y)10.62%
ROICexcg growth 3Y-19.64%
ROICexcg growth 5Y-5.32%
ROICexc growth 3Y-2.94%
ROICexc growth 5Y-2.03%
OM growth 3Y-3%
OM growth 5Y-2.76%
PM growth 3Y-0.64%
PM growth 5Y-2.25%
GM growth 3Y-0.95%
GM growth 5Y-0.8%
F-Score8
Asset Turnover0.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | 6.64 | ||
| Debt/EBITDA | 2.79 | ||
| Cap/Depr | 115.31% | ||
| Cap/Sales | 3.72% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 70.56% | ||
| Profit Quality | 82.7% | ||
| Current Ratio | 0.65 | ||
| Quick Ratio | 0.25 | ||
| Altman-Z | 2.68 |
F-Score8
WACC9.81%
ROIC/WACC0.83
Cap/Depr(3y)131.56%
Cap/Depr(5y)136.09%
Cap/Sales(3y)4.06%
Cap/Sales(5y)4.12%
Profit Quality(3y)94.06%
Profit Quality(5y)92.84%
High Growth Momentum
Growth
EPS 1Y (TTM)6.96%
EPS 3Y-1.11%
EPS 5Y1.98%
EPS Q2Q%-4.76%
EPS Next Y4.18%
EPS Next 2Y6.41%
EPS Next 3Y7.19%
EPS Next 5Y6.51%
Revenue 1Y (TTM)0.4%
Revenue growth 3Y2.1%
Revenue growth 5Y4.69%
Sales Q2Q%0.17%
Revenue Next Year1.74%
Revenue Next 2Y2.61%
Revenue Next 3Y3.02%
Revenue Next 5Y3.19%
EBIT growth 1Y2.14%
EBIT growth 3Y-0.97%
EBIT growth 5Y1.8%
EBIT Next Year24.5%
EBIT Next 3Y11.7%
EBIT Next 5Y8.33%
FCF growth 1Y41.95%
FCF growth 3Y5.54%
FCF growth 5Y-3.5%
OCF growth 1Y21.98%
OCF growth 3Y3.63%
OCF growth 5Y-0.53%