McCormick Earnings Preview

McCormick MKC is expected to release Q3 earnings on September 30. While FX is a challenge and inputs are volatile, consumers favor McCormick products and Deutsche Bank believes Industrial customers are gearing up new product efforts. Thus we believe LT goals (4-6% sales, 9-11% EPS) can be achieved. Deutsche Bank expects investors to focus on both US and EU consumer trends and to look for an inflation update given the recent run-up in commodities. Relations with retailers and category promotional activity will likely be of interest. Investors may also focus on foodservice trends, looking for further signs of improvement. Deutsche Bank has a $44 target price on McCormick. Risks include competition, and cost volatility. McCormick is trading lower at $41.55