McCormick & Co Inc Registered Shs Non Vtg MKC

McCormick Juices Brand Spending to Blunt the Hit From Intensifying Competition and Macro Angst

As the leading player in the $19 billion global spices and herbs market—with nearly 20% share, 4 times the next-largest operator, according to Euromonitor—McCormick is a valuable partner for retailers. However, competitive and macro headwinds abound. For one, McCormick continues to face cost pressure (related to select raw materials, transportation, and labor) that have ensnarled firms of all stripes. Further, we think consumers (particularly those with lower incomes and/or on a fixed budget) have tightened their spending, given stepped up prices at the grocery store as well as elevated interest rates and gas prices, which could serve to constrain its results if consumers trade down or out of the category.