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Citi upgrades McCormick ahead of earnings call

A shopper reaches toward a display of McCormick spices and flavorings. (Tim Fadek/Bloomberg News.)

A shopper reaches toward a display of McCormick spices and flavorings. (Tim Fadek/Bloomberg News.)

After a year and half of telling people to sell McCormick & Co. stock, Citigroup is telling shareholders to hold steady. A week before the company’s second-quarter earnings call, Citi has upgraded McCormick shares from sell to neutral, citing improvements in the Baltimore spicemaker’s earnings per share. Citi increased McCormick’s price objective from $85 to $102.

Analyst David Driscoll said the company has faced difficulties with its earnings per share but the tide appears to be turning.  McCormick faced more than 3.3 percentage points of cumulative dollar share losses from 2013 to 2015, analyst blog Benzinga reported. The company’s share price has been up by more than 10 basis points in the last three month period. McCormick’s spice retails sales are also up slightly after the first quarter of the current year, Driscoll said.
On Thursday, McCormick released 40 new products for the fall and holiday seasons including gourmet spice blends, Asian spices, Mexican and Latino flavor mixes, organic seasoning mixes, organic stocks and pepper blends.
Upgrades and downgrades are fairly uncommon with McCormick. The last time a research firm changed its recommendation on McCormick stock was on Feb. 18, when BB&T Capital Markets downgraded its stock quote from buy to hold.
McCormick will hold its second-quarter earnings call on June 30.

 

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