McCormick Beats on Both Top and Bottom Lines

McCormick (NYSE: MKC  ) reported earnings March 27. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Feb. 29 (Q1), McCormick beat expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share shrank.

Margins shrank across the board.

Revenue details
McCormick logged revenue of $906.7 million. The 10 analysts polled by S&P Capital IQ expected sales of $868.9 million on the same basis. GAAP reported sales were 16% higher than the prior-year quarter's $782.8 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.55. The 14 earnings estimates compiled by S&P Capital IQ averaged $0.53 per share. GAAP EPS of $0.55 for Q1 were 3.5% lower than the prior-year quarter's $0.57 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 39.2%, 270 basis points worse than the prior-year quarter. Operating margin was 12.4%, 170 basis points worse than the prior-year quarter. Net margin was 8.2%, 160 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $967.2 million. On the bottom line, the average EPS estimate is $0.62.

Next year's average estimate for revenue is $3.96 billion. The average EPS estimate is $3.04.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 370 members out of 384 rating the stock outperform, and 14 members rating it underperform. Among 133 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 130 give McCormick a green thumbs-up, and three give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on McCormick is outperform, with an average price target of $54.00.

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