McCormick Can Hit Long-Term Targets, Deutsche Bank Says

McCormick & Company, Incorporated MKC is scheduled to announce its second quarter financial results next Thursday. Ahead of the report, Deutsche Bank analysts Mario Contreras and Kanika Goyal shared a preview of the results.

According to a report issued Friday, the experts believe the company is “well positioned to deliver on its long-term targets including a recovery in U.S. Consumer, improving EM trends, strategic M&A actions, and various cost savings efforts.”

Related Link: McCormick No Longer A Sell At Citi After 1.5 Years

For the June 30 earnings report, the firm anticipates operating EPS of $0.73, $0.01 below consensus on a 3 percent increase in sales to $1.05 billion, and an 8.3 percent spike in EBIT to $133 million.

Deutsche Bank maintains a Buy rating on the stock. On Friday, the firm boosted its price target by $5 to $110, based on traditional multiples. A robust relative market share, a focused portfolio, and sturdy B/S (1.8x net debt/EBITDA) all help justify a premium valuation, the analysts concluded.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.