Please ensure Javascript is enabled for purposes of website accessibility

McCormick Says It Is Splitting Its Stock After Another Strong Sales Performance

By Demitri Kalogeropoulos – Sep 29, 2020 at 12:20PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Sales should grow by at least 6% this fiscal year, management announced.

The spicing and flavorings business is still booming. On Tuesday McCormick (MKC 1.60%) announced strong sales and profit results as part of its fiscal third-quarter announcement. Management also said it is conducting its first stock split since 2002 thanks to an improving demand outlook.

Revenue rose 9% in the three months ended on Aug. 31, which represented just a modest slowdown from the spike in the prior quarter that was influenced by pandemic-related restaurant shutdowns. McCormick continued to see elevated demand for its spices and condiments at supermarkets, but executives noted a solid rebound in its restaurant segment, too.

A home chef sprinkles seasoning on a steak.

Image source: Getty Images.

The growth through August has CEO Lawrence Kurzius and his team feeling confident enough to issue a short-term outlook for the first time since executives pulled their forecast in March. McCormick believes sales will rise by about 6% in fiscal 2020, compared to their pre-COVID-19 outlook of roughly 2% gains.

Elevated demand for at-home cooking products may continue to lift results at least into early 2021, and that trend factored into management's 2-for-1 stock split announcement. McCormick plans to distribute the new shares in late November, with the stock trading under the split-adjusted price starting on Dec. 1.

Demitri Kalogeropoulos has no position in any of the stocks mentioned. The Motley Fool recommends McCormick. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

McCormick & Company, Incorporated Stock Quote
McCormick & Company, Incorporated
MKC
$72.41 (1.60%) $1.14

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
326%
 
S&P 500 Returns
102%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/03/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.