Packaged Foods · NYSE
Current Price
$50.54
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on McCormick & Company, Incorporated with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
Open DCF Calculator for MKCMcCormick & Company, Incorporated manufactures, markets, and distributes spices, seasoning mixes, condiments, and other flavorful products to the food industry. It operates in two segments, Consumer and Flavor Solutions. The Consumer segment offers spices, herbs, and seasonings, as well as condiments and sauces, and desserts. This segment markets its products under the McCormick, French's, Frank's RedHot, Lawry's Cholula Hot Sauce, Gourmet Garden, Club House, and OLD BAY brands in the Americas; Ducros, Schwartz, Kamis, and Drogheria & Alimentari, and Vahiné brands in Europe, the Middle East, and Africa; McCormick and DaQiao brands in China; and McCormick, Aeroplane, and Gourmet Garden brands in Australia, as well as markets regional and ethnic brands, such as Zatarain's, Stubb's, Thai Kitchen, and Simply Asia. It also supplies its products under the private labels. This segment serves retailers comprising grocery, mass merchandise, warehouse clubs, discount and drug stores, and e-commerce retailers directly and indirectly through distributors and wholesale foodservice suppliers. The Flavor Solutions segment offers seasoning blends, spices and herbs, condiments, coating systems, and compound flavors to multinational food manufacturers and foodservice customers. It serves foodservice customers directly and indirectly through distributors. The company was founded in 1889 and is headquartered in Hunt Valley, Maryland.
ROIC (TTM)
6.1%
ROE (TTM)
27.3%
FCF Yield
6.26%
Based on trailing twelve-month data, MKC shows a free cash flow per share of N/A and a ROIC of 6.1%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 6.26% are important context metrics when evaluating MKC's stock valuation relative to peers.
The intrinsic value of MKC depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether MKC is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $50.54. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on McCormick & Company, Incorporated: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Packaged Foods industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting MKC's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For McCormick & Company, Incorporated, this means projecting how much free cash flow the Packaged Foods will produce over the next 5-10 years, then discounting those amounts to today's dollars. MKC's ROIC of 6.1% suggests the company may face challenges generating returns above its cost of capital.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For MKC, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
