McCormick Stocks Powerfully Dropped. How It Is Connected to China

<p>What's
that scent in the air? It's the aroma of stocks that have taken an 8% hit in
just a week, and a 14% one in a month. And if you happen to hold McCormick
stocks in your portfolio, you're probably well aware of it. The spice giant's
shares are experiencing some turbulence. Let’s delve into the details of what
has happened and what the future of these shares analysts see.

</p><p>McCormick
&amp; Co. specializes in spices, seasoning mixes, condiments, and other
flavorful products. Manufacturing, distribution, marketing, and more. Also, to
find stocks from different sectors, with varying financial and technical stats,
you can <a href="https://www.tradingview.com/screener/" target="_blank" rel="follow">use the stock screener</a>. While it may not have a
"smell" filter (we are not sure about that), this tool offers a
wealth of other data to help one find some “sweet-smelling” stocks.</p><p>But
let’s get back to McCormick. We’ve prepared the chart illustrating the
movements of these stocks over the past five days. It's showing a nearly 8.5%
drop.</p><p>The
following chart reveals an even stronger decline since the beginning of 2023.</p><p>In other
words, the share price has plummeted to $68, the lowest since the Covid-19
pandemic in 2020.</p><p>The main
reason behind such a drop is the company's performance in the Asia-Pacific
region in the third quarter. McCormick reported a substantial 16% drop in sales
there, primarily due to the economic slowdown in China. As you can imagine,
this is a huge market.</p><p>Other
figures might not look so bad. EPS turned out to be only 0.31% worse than
expected, and the revenue fell short by 0.71% compared to estimates.
Simultaneously, McCormick reported a 5.5% increase in total sales compared to
Q3 2022. While not catastrophic, these numbers failed to impress the market
participants.</p><p>The
company pointed out several factors negatively impacting its financial report,
including the <a href="https://uk.advfn.com/newspaper/igorkuchma/70184/china-growth-less-than-expected" target="_blank" rel="follow">Chinese economic situation</a>, the sale of the
Kitchen Basics brand, exit from the Russian customer market, and decisions
related to closing low-margin business segments.</p><p>Following
the report, many analyst firms adjusted their <a href="https://money.cnn.com/quote/forecast/forecast.html?symb=MKC#:~:text=Stock%20Price%20Forecast,the%20last%20price%20of%2068.41." target="_blank" rel="follow">consensus forecasts</a>. For instance, Deutsche
Bank lowered its target from $82 to $72, Goldman Sachs from $66 to $64, and BNP
Paribas from $95 to $83. The prevailing trend is quite evident. However, the
consensus forecast, which is an aggregate of multiple analyst opinions, still
maintains a positive outlook for McCormick stocks, projecting a 15% increase
over the next 12 months.</p><p>Keep in
mind that expert opinions can change frequently, so conducting your own
analysis before making any trades is advisable.</p>

This article was written by FL Contributors at www.forexlive.com.