Shares of McCormick & Co. (MKC) are down about 6% over the past twelve months, which presents potential investors an opportunity that shouldn’t be passed up in my view. The shares currently represent excellent long term value in my view for a host of reasons that I’ll outline below. In sum, this is a low risk business with an excellent “moat” that has an outstanding dividend history. In addition, the shares are reasonably priced relative to the overall market. Finally, there has been an insider buy which I think we should take note of.
Financial Snapshot
A quick review of the past five years of financial history here suggests that after all of this time, this is still a growth company. Although revenue is up at a CAGR of just shy of 2% over the past five years, net income has been a bit more volatile. In spite of this volatility in net income, the company has managed to grow dividends per share at a CAGR of about 6.75% over the past five years on a declining share base.
