McCormick & Co Second Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component McCormick & Co (NYSE:MKC) will unveil its latest earnings on Wednesday, June 27, 2012. McCormick & Company manufactures flavor products including spices, herbs, extracts, seasonings, flavorings, and other food products.

McCormick & Co Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for net income of 61 cents per share, a rise of 10.9% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from 62 cents. Between one and three months ago, the average estimate moved down. It has been unchanged at 61 cents during the last month. Analysts are projecting profit to rise by 7.4% versus last year to $3.05.

Past Earnings Performance: Last quarter, the company beat estimates by 2 cents, coming in at profit of 55 cents a share versus the estimate of net income of 53 cents a share. It marked the fourth straight quarter of beating estimates.

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Wall St. Revenue Expectations: On average, analysts predict $969.8 million in revenue this quarter, a rise of 9.7% from the year-ago quarter. Analysts are forecasting total revenue of $4.05 billion for the year, a rise of 9.5% from last year’s revenue of $3.7 billion.

Stock Price Performance: Between March 27, 2012 and June 21, 2012, the stock price rose $3.52 (6.5%), from $54.22 to $57.74. The stock price saw one of its best stretches over the last year between June 7, 2012 and June 19, 2012, when shares rose for nine straight days, increasing 6.1% (+$3.36) over that span. It saw one of its worst periods between November 15, 2011 and November 23, 2011 when shares fell for seven straight days, dropping 5.7% (-$2.82) over that span.

A Look Back: In the first quarter, profit fell 3% to $74.5 million (55 cents a share) from $76.8 million (57 cents a share) the year earlier, but exceeded analyst expectations. Revenue rose 15.8% to $906.7 million from $782.8 million.

Key Stats:

The company enters this earnings announcement with substantial revenue momentum. The company has averaged year-over-year revenue growth of 13.9% over the last four quarters.

An income boost this time around would be welcome news after profit drops in the past three quarters. Net income fell 10.2% in the third quarter of the last fiscal year, by 1.4% in the fourth quarter of the last fiscal year and again in the first quarter.

Analyst Ratings: With eight analysts rating the stock a buy, none rating it a sell and four rating the stock a hold, there are indications of a bullish stance by analysts.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.24 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term.

(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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