MCCORMICK & CO. INC. $71 - New York symbol MKC

MCCORMICK & CO. INC. $71 (New York symbol MKC; Income Portfolio, Consumer sector; Shares outstanding: 119.0 million; Market cap: $8.4 billion; Price-to-sales ratio: 2.3; Dividend yield: 2.1%; TSINetwork Rating: Average; www.mccormick.com) makes spices, herbs, seasonings and flavours. It sells these products to consumers and industrial clients. In its fiscal 2014 second quarter, which ended May 31, 2014, McCormick’s sales rose 3.1%, to $1.03 billion from $1.00 billion a year earlier. That’s mainly because McCormick bought a Chinese bouillon maker for $144.8 million in May 2013. This purchase offset lower sales in the Americas.

Earnings gained 7.5%, to $84.5 million, or $0.64 a share, from $78.6 million, or $0.59, a year earlier.

McCormick continues to benefit from its ongoing cost cuts, which should save it $45 million in fiscal 2014. That will help fund the additional $25 million it plans to spend on advertising this year.

The stock trades at 21.8 times McCormick’s likely fiscal 2014 earnings of $3.26 a share. The $1.48 dividend yields 2.1%.

McCormick is a buy.

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