NYSE:MKC
MCCORMICK & CO INC
A global food ingredients powerhouse delivering consistent revenue growth through a diversified portfolio of branded spices and seasoning mixes.
Key Metrics
Investment Thesis
Bull Case
Investors may favor MKC for its consistent track record of revenue growth, having expanded from $6.35B in 2022 to $6.84B in 2025 while maintaining healthy profit margins. The company's ability to generate strong operating cash flow relative to net income demonstrates high quality earnings and provides flexibility for shareholder returns via dividends and buybacks. A diversified product portfolio across multiple categories offers protection against single-category downturns, supporting long-term stability.
Bear Case
Potential investors should be wary of the heavy debt load, with total liabilities at $7.43B compared to shareholders' equity of $5.77B, which could constrain financial flexibility during economic stress. High interest expense of $196.2M combined with accumulated other comprehensive losses of -$363.1M indicates underlying leverage and currency headwinds that could pressure future returns. Dependence on the consumer discretionary market makes the stock vulnerable to recessionary trends where spending on premium food ingredients may decline.
About MCCORMICK & CO INC
McCormick & Company (NYSE: MKC) is a global leader in the food and beverage ingredients industry, specializing in spices, seasoning blends, and sauces sold directly to consumers and through major retailers. The company serves markets across North America, Europe, Asia, and Latin America with its portfolio of branded consumer products and private label goods. Key offerings include iconic brands like McCormick Gourmet, Mrs. Dash, and Hidden Valley.
Analysis
Management Discussion
The company delivered robust financial performance in 2025 with revenue reaching $6.84B and net profit of $789.4M, reflecting strong operational execution and effective pricing strategies. Operating cash flow from operations surged to $962.2M, indicating healthy liquidity generation despite significant financing outflows of $840.9M related to share repurchases and dividends. The reduction in inventory levels by $23.9M suggests efficient working capital management alongside a slight increase in accounts receivable.
Industry Overview
The global food and beverage ingredients industry is highly competitive but offers stable demand driven by population growth and evolving consumer preferences for convenient, flavorful meals. Companies in this sector benefit from brand loyalty and distribution reach, yet face pressure from inflation and supply chain volatility that challenge margins. Success requires continuous innovation to capture share of wallet as consumers trade up or down based on economic conditions.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $6.35B | $6.66B | $6.72B | $6.84B |
| Cost of Revenue | $4.08B | $4.16B | $4.13B | $4.25B |
| Gross Profit | $2.27B | $2.50B | $2.59B | $2.59B |
| Operating Expenses | $1.41B | $1.54B | $1.53B | $1.52B |
| Operating Income | $863.6M | $963.0M | $1.06B | $1.07B |
| R&D | $87.5M | $94.9M | $102.9M | $106.1M |
| G&A | $1.36B | $1.48B | $1.52B | $1.50B |
| Stock-Based Comp | $60.3M | $63.4M | $47.4M | $46.2M |
| D&A | $200.6M | $199.3M | $208.8M | $231.3M |
| Depreciation | $136.3M | $135.3M | $143.3M | $163.2M |
| Amortization | $35.1M | $34.9M | $35.0M | $35.2M |
| Other OpEx | $-33.7M | $-33.7M | $-93.4M | $-85.0M |
| Non-Operating Income | $-50.8M | $-164.3M | $-162.0M | $-157.8M |
| Interest Expense | $149.1M | $208.2M | $209.4M | $196.2M |
| Interest Income | $17.8M | $36.6M | $45.9M | $40.1M |
| Pre-Tax Income | $812.8M | $798.7M | $898.3M | $913.0M |
| Income Tax | $168.6M | $174.5M | $184.0M | $195.8M |
| Continuing Ops | $644.2M | $624.2M | $714.3M | $717.2M |
| Discontinued Ops | $37.8M | $56.4M | $74.2M | $72.2M |
| Net Income | $682.0M | $680.6M | $788.5M | $789.4M |
| Minority Interest | $0 | $0 | $0 | $0 |
| Net to Common | $682.0M | $680.6M | $788.5M | $789.4M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $2.39B | $2.00B | $2.14B | $2.14B |
| Cash & Equivalents | $334.0M | $166.6M | $186.1M | $95.9M |
| Accounts Receivable | $573.7M | $587.5M | $587.4M | $628.9M |
| Inventory | $1.34B | $1.13B | $1.24B | $1.27B |
| Prepaid Expenses | $138.9M | $121.0M | $125.6M | $141.3M |
| Other Current Assets | $0 | $0 | $0 | $0 |
| Long-Term Assets | $10.74B | $10.86B | $10.93B | $11.06B |
| PP&E (Net) | $1.20B | $1.32B | $1.41B | $1.45B |
| Intangibles | $3.39B | $3.36B | $3.32B | $3.29B |
| Goodwill | $5.21B | $5.26B | $5.23B | $5.30B |
| Operating Leases | $218.9M | $220.0M | $211.0M | $216.8M |
| LT Investments | $115.1M | $115.0M | $130.5M | $132.9M |
| Other LT Assets | $605.4M | $584.2M | $630.4M | $669.4M |
| Total Assets | $13.12B | $12.86B | $13.07B | $13.20B |
| Current Liabilities | $3.43B | $3.10B | $2.88B | $3.06B |
| Current Debt | $270.6M | $799.3M | $265.2M | $509.1M |
| Current Leases | $54.4M | $53.3M | $55.7M | $58.9M |
| Other Current Liab | $3.11B | $2.25B | $2.56B | $2.49B |
| Long-Term Liabilities | $4.99B | $4.68B | $4.87B | $4.37B |
| Long-Term Debt | $3.64B | $3.34B | $3.59B | $3.11B |
| LT Operating Leases | $176.1M | $179.9M | $166.6M | $167.7M |
| Other LT Liab | $-79.3M | $863.0M | $658.6M | $744.8M |
| Total Liabilities | $8.43B | $7.78B | $7.75B | $7.43B |
| Shareholders' Equity | $4.70B | $5.08B | $5.32B | $5.77B |
| Retained Earnings | $3.02B | $3.25B | $3.54B | $3.82B |
| AOCI | $-480.6M | $-388.6M | $-491.2M | $-363.1M |
| Total L&E | $13.12B | $12.86B | $13.07B | $13.20B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $682.0M | $680.6M | $788.5M | $789.4M |
| Non-Cash Adjustments | $-536.8M | $962.2M | $-219.8M | $86.6M |
| Working Capital Changes | $506.3M | $-405.5M | $353.2M | $86.2M |
| Cash from Operations | $651.5M | $1.24B | $921.9M | $962.2M |
| Capital Expenditures | $262.0M | — | — | — |
| Cash from Investing | $-146.4M | $-260.5M | $-269.0M | $-255.2M |
| Debt Issuances | $0 | $496.4M | $495.5M | $2.7M |
| Debt Repayments | $772.0M | $268.1M | $801.1M | $267.9M |
| Share Buybacks | $38.8M | $35.7M | $53.1M | $34.8M |
| Dividends Paid | $396.7M | $418.5M | $451.0M | $483.0M |
| Cash from Financing | $-487.2M | $-1.18B | $-583.1M | $-840.9M |
| FX Effect | $-35.6M | $40.0M | $-50.3M | $43.7M |
| Net Change in Cash | $-17.7M | $-167.4M | $19.5M | $-90.2M |
| Beginning Cash | $351.7M | $334.0M | $166.6M | $186.1M |
| Ending Cash | $334.0M | $166.6M | $186.1M | $95.9M |
Frequently Asked Questions
How does MCCORMICK & CO INC make money?
Revenue is driven primarily by consumer packaged goods sold through retail channels, private label manufacturing for major retailers, and foodservice solutions including sauces and seasonings. The company leverages its extensive R&D capabilities to launch new products that drive top-line growth while maintaining high gross margins on its core spice and seasoning blends.
What are the main risks for MKC?
Fluctuations in foreign exchange rates can significantly impact reported earnings given the company's substantial international sales exposure. Supply chain disruptions affecting the sourcing of key spices or agricultural commodities could lead to higher input costs and margin compression. Regulatory changes regarding food labeling, safety standards, or trade tariffs in key markets like China and Brazil pose operational risks.
What is MKC's competitive advantage?
McCormick possesses an unmatched portfolio of proprietary recipes and brand equity built over 125 years, creating deep customer loyalty among home cooks and professional chefs. The company's global supply chain network ensures consistent quality and cost efficiency in sourcing agricultural commodities, providing resilience against market volatility. Strong pricing power allows the firm to maintain profitability even when raw material costs fluctuate.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.