HUNT VALLEY, MD - McCormick (NYSE:MKC) & Company, Incorporated (NYSE: MKC), a global leader in flavor, has announced an increase in its quarterly dividend. The dividend on common stocks will rise from $0.42 to $0.45 per share, payable on January 13, 2025, to shareholders of record as of December 30, 2024. This change underscores McCormick's 101st year of continuous dividend payments and its 39th year of consecutive dividend increases.
Brendan M. Foley, President & CEO of McCormick, expressed the company's commitment to growth and shareholder value, emphasizing the significance of their status as a Dividend Aristocrat. He highlighted the dividend increase as a reflection of the company's dedication to cash returns for its shareholders.
McCormick has a long-standing history of dividend payments dating back to 1925, and its consistent dividend growth has earned it a place in the S&P 500 Dividend Aristocrats Index. The company, founded in 1889, has over $6.5 billion in annual sales and operates in 150 countries and territories. It offers a wide range of products, including herbs, spices, seasonings, and flavors, catering to retailers, food manufacturers, and the foodservice industry.
The company's portfolio includes well-known brands such as McCormick, French's, and Frank's RedHot. With two main business segments, Consumer and Flavor Solutions, McCormick aims to leverage its scale, insights, and technology to drive sustainable growth.
The dividend increase announcement is based on a press release statement and reflects McCormick's ongoing strategy to enhance shareholder returns while maintaining its position in the global flavor industry.
In other recent news, McCormick & Company reported robust third-quarter earnings, with a 15% rise in adjusted operating income to $288 million year-over-year. Adjusted earnings per share reached $0.83, surpassing the consensus estimate of $0.67. Consequently, McCormick updated its full-year 2024 guidance, adding $0.05 to account for a discrete tax benefit.
Analyst firms including TD Cowen, Jefferies, and HSBC (LON:HSBA) maintained a Hold rating on McCormick's stock. TD Cowen expressed skepticism about McCormick's ability to meet its organic growth targets due to potential challenges in the Chinese market. However, BofA Securities lifted McCormick's stock target and maintained a Buy rating, citing the strong earnings and improved outlook.
During its recent Investor Day, McCormick outlined a strategy to achieve a 4% organic growth rate by the fiscal year 2026, shifting its growth strategy away from relying on acquisitions. The company also anticipates organic sales growth of 2-3% for fiscal year 2025, aligning with consensus estimates. McCormick's long-term growth targets remain unchanged, aiming for increases in net sales, operating income, and earnings per share over the next five years.
In other developments, U.S. Senate candidate David McCormick has taken legal action seeking permission for mass challenges to provisional ballots in Philadelphia. McCormick is currently leading against Democratic incumbent Senator Bob Casey by approximately 34,600 votes. The victory would contribute to the Republican majority in the Senate starting next year. McCormick has requested that the court sequester provisional ballots cast by voters whose mail-in or absentee ballots were rejected due to issues such as a missing inner secrecy envelope.
InvestingPro Insights
McCormick's recent dividend increase aligns with its long-standing commitment to shareholder value, as highlighted by InvestingPro data. The company's dividend yield stands at 2.25%, with a notable dividend growth of 7.69% over the last twelve months. This increase is particularly significant given that McCormick has maintained dividend payments for 54 consecutive years, according to InvestingPro Tips.
The company's financial health appears robust, with a market capitalization of $20.22 billion and revenue of $6.68 billion over the last twelve months. Despite a slight revenue decline of 0.29% in the most recent quarter, McCormick has maintained profitability, as indicated by its positive earnings per share of $2.94.
InvestingPro Tips also reveal that McCormick operates with a moderate level of debt and has been profitable over the last twelve months. These factors contribute to the company's ability to sustain its dividend growth strategy. However, investors should note that the stock is trading at a relatively high P/E ratio of 25.46, which may indicate that the market has already priced in much of the company's growth potential.
For those interested in a deeper analysis, InvestingPro offers additional tips and insights on McCormick's financial performance and outlook. In fact, there are 8 more InvestingPro Tips available for MKC, providing a comprehensive view for potential investors.
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