What happened

Shares of spice and flavors maker McCormick (MKC -0.46%) are surging this morning. Investors are pushing the stock higher by double digits in response to the company's latest quarterly earnings release. McCormick shares were higher by as much as 13.2% and remained up by 10.2% at 11 a.m. ET.

So what

The maker of cooking herbs and spices as well as popular brands including French's, Grill Mates, Old Bay, and Frank's RedHot beat analysts' expectations. Adjusted for special charges and one-time items, the company earned $0.59 per share versus an expected profit of $0.50 per share. Revenue of $1.57 billion rose 3% year over year and also exceeded expectations. 

The company pointed to its diversified global portfolio of products as well as a balanced strategy between consumers and commercial customers as the reason for the strong quarter. 

home cook sprinkling spices on skillet.

Image source: Getty Images.

Now what

McCormick's consumer business has benefited over the past several years from a home cooking trend accelerated by the pandemic. It is successfully navigating the post-pandemic environment with the balance from its flavor solutions segment as business picks up at restaurants and other commercial food businesses. Sales from that commercial segment grew 10% compared to the year-ago quarter, while revenue from the consumer segment declined by 2%. 

That balance has led investors to value McCormick stock highly compared to competitors including JM Smucker and Kraft-Heinz. After today's pop, McCormick shares are trading at a price-to-earnings (P/E) ratio of nearly 32 based on the company's reaffirmed guidance for 2023 profit. 

But that shouldn't dissuade investors from owning McCormick shares, given its balanced business strategy. Shares are still down more than 15% over the past year. Gradually adding shares over time can be a good way to help achieve better returns. The company also has a history of increasing its dividend, which yields about 2% after today's jump in shares.