MCCORMICK & CO-NON VTG SHRS (MKC) Stock Fundamental Analysis
NYSE:MKC - New York Stock Exchange, Inc. - US5797802064 - Common Stock - Currency: USD
Overall MKC gets a fundamental rating of 5 out of 10. We evaluated MKC against 91 industry peers in the Food Products industry. MKC has an excellent profitability rating, but there are concerns on its financial health. While showing a medium growth rate, MKC is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year MKC was profitable.
MKC had a positive operating cash flow in the past year.
MKC had positive earnings in each of the past 5 years.
In the past 5 years MKC always reported a positive cash flow from operatings.
1.2 Ratios
MKC has a better Return On Assets (5.88%) than 74.73% of its industry peers.
MKC has a better Return On Equity (13.85%) than 79.12% of its industry peers.
MKC has a Return On Invested Capital of 8.03%. This is in the better half of the industry: MKC outperforms 78.02% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MKC is significantly below the industry average of 28.40%.
The last Return On Invested Capital (8.03%) for MKC is above the 3 year average (7.52%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.88% | ||
| ROE | 13.85% | ||
| ROIC | 8.03% |
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 has a better Profit Margin (11.50%) than 90.11% of its industry peers.
MKC's Profit Margin has declined in the last couple of years.
MKC's Operating Margin of 16.02% is amongst the best of the industry. MKC outperforms 90.11% of its industry peers.
In the last couple of years the Operating Margin of MKC has declined.
MKC's Gross Margin of 38.54% is amongst the best of the industry. MKC outperforms 86.81% of its industry peers.
MKC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.02% | ||
| PM (TTM) | 11.5% | ||
| GM | 38.54% |
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.
The number of shares outstanding for MKC has been increased compared to 5 years ago.
The debt/assets ratio for MKC has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.68 indicates that MKC is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of MKC (2.68) is better than 64.84% of its industry peers.
MKC has a debt to FCF ratio of 8.07. This is a slightly negative value and a sign of low solvency as MKC would need 8.07 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 8.07, MKC is doing good in the industry, outperforming 65.93% of the companies in the same industry.
MKC has a Debt/Equity ratio of 0.66. This is a neutral value indicating MKC is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.66, MKC perfoms like the industry average, outperforming 41.76% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | 8.07 | ||
| Altman-Z | 2.68 |
ROIC/WACC1
WACC8.06%
2.3 Liquidity
A Current Ratio of 0.68 indicates that MKC may have some problems paying its short term obligations.
MKC has a Current ratio of 0.68. This is amonst the worse of the industry: MKC underperforms 83.52% of its industry peers.
A Quick Ratio of 0.27 indicates that MKC may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.27, MKC is doing worse than 91.21% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.68 | ||
| Quick Ratio | 0.27 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.55% over the past year.
MKC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 1.98% yearly.
MKC shows a small growth in Revenue. In the last year, the Revenue has grown by 0.89%.
Measured over the past years, MKC shows a small growth in Revenue. The Revenue has been growing by 4.69% on average per year.
EPS 1Y (TTM)3.55%
EPS 3Y-1.11%
EPS 5Y1.98%
EPS Q2Q%0%
Revenue 1Y (TTM)0.89%
Revenue growth 3Y2.1%
Revenue growth 5Y4.69%
Sales Q2Q%0.99%
3.2 Future
Based on estimates for the next years, MKC will show a small growth in Earnings Per Share. The EPS will grow by 6.22% on average per year.
The Revenue is expected to grow by 2.99% on average over the next years.
EPS Next Y4.18%
EPS Next 2Y6.41%
EPS Next 3Y7.19%
EPS Next 5Y6.22%
Revenue Next Year1.74%
Revenue Next 2Y2.61%
Revenue Next 3Y3.02%
Revenue Next 5Y2.99%
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
With a Price/Earnings ratio of 25.74, MKC can be considered very expensive at the moment.
MKC's Price/Earnings is on the same level as the industry average.
MKC's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.45.
A Price/Forward Earnings ratio of 22.50 indicates a rather expensive valuation of MKC.
MKC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. MKC is cheaper than 61.54% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.90, MKC is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.74 | ||
| Fwd PE | 22.5 |
4.2 Price Multiples
MKC's Enterprise Value to EBITDA is on the same level as the industry average.
MKC's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 36.52 | ||
| EV/EBITDA | 18.42 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of MKC may justify a higher PE ratio.
PEG (NY)6.16
PEG (5Y)13.02
EPS Next 2Y6.41%
EPS Next 3Y7.19%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.40%, MKC has a reasonable but not impressive dividend return.
MKC's Dividend Yield is a higher than the industry average which is at 4.67.
Compared to an average S&P500 Dividend Yield of 2.38, MKC has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.4% |
5.2 History
On average, the dividend of MKC grows each year by 8.09%, which is quite nice.
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
60.21% of the earnings are spent on dividend by MKC. This is not a sustainable payout ratio.
MKC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP60.21%
EPS Next 2Y6.41%
EPS Next 3Y7.19%
75.15
-1.41 (-1.84%)
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 Cap20.15B
Analysts72
Price Target85.85 (14.24%)
Short Float %1.97%
Short Ratio2.14
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.4% |
Yearly Dividend1.68
Dividend Growth(5Y)8.09%
DP60.21%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.83%
Min EPS beat(2)-7.59%
Max EPS beat(2)3.93%
EPS beat(4)3
Avg EPS beat(4)5.18%
Min EPS beat(4)-7.59%
Max EPS beat(4)21.3%
EPS beat(8)6
Avg EPS beat(8)6.22%
EPS beat(12)8
Avg EPS beat(12)3.45%
EPS beat(16)11
Avg EPS beat(16)1.85%
Revenue beat(2)0
Avg Revenue beat(2)-1.15%
Min Revenue beat(2)-1.38%
Max Revenue beat(2)-0.93%
Revenue beat(4)1
Avg Revenue beat(4)-0.54%
Min Revenue beat(4)-1.38%
Max Revenue beat(4)0.39%
Revenue beat(8)2
Avg Revenue beat(8)-0.69%
Revenue beat(12)3
Avg Revenue beat(12)-1.08%
Revenue beat(16)4
Avg Revenue beat(16)-0.99%
PT rev (1m)-0.77%
PT rev (3m)-1.5%
EPS NQ rev (1m)-0.41%
EPS NQ rev (3m)-2.85%
EPS NY rev (1m)-0.12%
EPS NY rev (3m)-0.73%
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 | 25.74 | ||
| Fwd PE | 22.5 | ||
| P/S | 2.99 | ||
| P/FCF | 36.52 | ||
| P/OCF | 25.78 | ||
| P/B | 3.6 | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.42 |
EPS(TTM)2.92
EY3.89%
EPS(NY)3.34
Fwd EY4.45%
FCF(TTM)2.06
FCFY2.74%
OCF(TTM)2.92
OCFY3.88%
SpS25.14
BVpS20.89
TBVpS-11.18
PEG (NY)6.16
PEG (5Y)13.02
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.88% | ||
| ROE | 13.85% | ||
| ROCE | 10.79% | ||
| ROIC | 8.03% | ||
| ROICexc | 8.12% | ||
| ROICexgc | 45.31% | ||
| OM | 16.02% | ||
| PM (TTM) | 11.5% | ||
| GM | 38.54% | ||
| FCFM | 8.18% |
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-Score7
Asset Turnover0.51
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | 8.07 | ||
| Debt/EBITDA | 2.85 | ||
| Cap/Depr | 106.09% | ||
| Cap/Sales | 3.41% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 60.29% | ||
| Profit Quality | 71.14% | ||
| Current Ratio | 0.68 | ||
| Quick Ratio | 0.27 | ||
| Altman-Z | 2.68 |
F-Score7
WACC8.06%
ROIC/WACC1
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)3.55%
EPS 3Y-1.11%
EPS 5Y1.98%
EPS Q2Q%0%
EPS Next Y4.18%
EPS Next 2Y6.41%
EPS Next 3Y7.19%
EPS Next 5Y6.22%
Revenue 1Y (TTM)0.89%
Revenue growth 3Y2.1%
Revenue growth 5Y4.69%
Sales Q2Q%0.99%
Revenue Next Year1.74%
Revenue Next 2Y2.61%
Revenue Next 3Y3.02%
Revenue Next 5Y2.99%
EBIT growth 1Y4.25%
EBIT growth 3Y-0.97%
EBIT growth 5Y1.8%
EBIT Next Year24.5%
EBIT Next 3Y11.7%
EBIT Next 5Y8.05%
FCF growth 1Y-9.88%
FCF growth 3Y5.54%
FCF growth 5Y-3.5%
OCF growth 1Y-12.29%
OCF growth 3Y3.63%
OCF growth 5Y-0.53%