Kurzius said that consumers continue to crave flavorful foods and McCormick's spices are the best way to get that flavor at home. McCormick is now the No. 1 maker of hot sauce.
Turning to the topic of inflation, Kurzius noted that while McCormick has been able to deliver 20% sales and earnings growth since the pandemic began, the amount of inflation they're seeing is unprecedented. It spans from ingredients to packaging to labor and transportation, he said, and they're doing everything they can to keep it under control.
Let's check out the MKC charts.
In the daily bar chart of MKC, below, we can see that the shares have been working lower and lower since the middle of October. Prices are trading below the declining 50-day moving average line and the declining 200-day moving average line.
The On-Balance-Volume (OBV) line has been in a decline the past 12 months and tells us that sellers of MKC have been more aggressive. The Moving Average Convergence Divergence (MACD) oscillator is below the zero line in bearish territory.
In the weekly Japanese candlestick chart of MKC, below, we can see that the shares make a top back in August 2020. MKC is trading below the declining 40-week moving average line.
The weekly OBV line shows weakness from October 2020 as traders have been more aggressive sellers of the spice maker. The MACD oscillator is bearish and has been below the zero line for most of this year.
In this daily Point and Figure chart of MKC, below, we can see that the shares reached a downside price target of $81.
In this weekly Point and Figure chart of MKC, below, a $75 price target is indicated.
Bottom-line strategy: In our Aug. 3rd review of MKC here we wrote that, "I seem to be using McCormick products more than ever this summer grilling season, but it has not helped the charts which are pointed down. Avoid the long side of MKC for now." That advice in early August still seems appropriate.