McCormick (MKC) is an American corporation that specializes in spices and other kinds of food flavoring. As such, it isn’t exactly the most exciting corporation that can be found out there. However, there are reasons to believe that McCormick could be an excellent choice for someone who prefers to buy and hold onto stocks.
Is McCormick a Good Stock to Buy and Hold?
McCormick might not be the most exciting corporation that can be found out there. However, exciting isn’t necessarily the best characteristics for a stock that people want to buy and hold on to. After all, exciting tends to come with strong connotations of risk, which might mean plenty of upward potential but also mean plenty of downward potential. Instead, what makes McCormick such a good choice for people with a preference for long-term investment strategies is the fact that it possesses a strong set of fundamentals that promise continuing growth in the times to come.
In short, McCormick has been seeing strong sales that have translated to strong profits in recent times. However, it is interesting to note that this strength hasn’t come from a single source. Instead, McCormick’s success can be traced to a number of its strategies. One example would be McCormick’s effort to cut its operational costs by making its processes much efficient without sacrificing efficacy in the process. Another example would be McCormick’s efforts to convince its retail partners to make more shelf space available for its products, thus providing it with more chances to sell its food flavoring products to potential customers. On top of this, it should be mentioned that McCormick has even been introducing new sizes for some of its existing products, which is relevant because that enables it to target more segments of its customer base. Overall, McCormick’s efforts haven’t been successful on a universal basis, but they have been sufficiently successful in enough respects for it to see significant improvements.
With that said, there are other encouraging factors as well. For example, it is known that McCormick is continuing to release new products, thus creating new sources of revenue for the corporation. Likewise, the corporation is looking into distribution improvements for its existing products as well as more high-profile marketing campaigns, which could produce respectable results when put into combination. Together with the previous initiatives, it is clear that McCormick is very proactive about becoming more profitable in its chosen sector, thus making it a good choice for someone looking at the long run.
McCormick’s performance is particularly impressive in light of the fact that it recently swallowed a $4 billlion acquisition. Generally speaking, that kind of acquisition tends to be pretty unnerving for investors. After all, there is no such thing as a simple and straightforward acquisition, as shown by the numerous stories of companies that have run into serious problems because of unexpected complications from their acquisitions. However, no such thing happened to McCormick in regards to its acquisition. Instead, its hand strengthened because the acquisition provided it with a number of new well-established brands, each of which promise to provide it with more ways to make money off of its customer base. As such, the acquisition further strengthened McCormick’s long-term potential, particularly since there are reasons to believe that its new and existing brands could very well serve as synergies for one another.
Having said this, interested individuals shouldn’t just assume that McCormick is indeed the right choice for their particular investment needs. Ultimately, each person has their own reasons for investing, meaning that they are the ones who have the best understandings of their needs and circumstances. Certainly, interested individuals should be getting as much assistance as they can get from the professionals, but at the end of the day, they should still look over things to make sure that they are getting things right.
As such, people who are interested by McCormick should make sure to take a look at the corporation’s business activities so that they can get at least a general idea of how the corporation makes its money as well as why various parties have spoken well about it in recent times. The better informed they are, the better their chances of making a successful investment on this as well as other matters.