MKC US S&P 500Russell 1000 Earnings call

McCormick & Company (MKC) · Q3 2026 results and valuation

Share price: $46.94 · 2026-11-11

McCormick & Company manufactures, markets, and distributes herbs, spices, seasoning mixes, condiments, and other flavorful products. The company serves the food and beverage industry, including retailers, food manufacturers, and foodservice businesses across North America, Europe, China, and other international markets. Source: 10-K annual report (2026-01-22)

Results Q3 2026 vs Q2 2026 · previous quarter · published 1 Oct 2026 and 25 Jun 2026

Net income down 35.0% on the previous quarter. Management sounded cautious, though noticeably more positive answering analysts.

1 · Numbers

−35.0%

Net income vs Q2 2026

Outlook given

Net income 97.6M vs 150.1M

Revenue +4.6%

Against the same quarter last year (Q3 2025) it is −56.7%, so it is not just seasonal.

Why Against the same quarter last year (−56.7%), net income fell because the third quarter adjusted effective tax rate was 22.6% compared to 16.1% in the prior year, driven by a greater level of favorable tax items in the prior year.

2 · How management spoke

Cautious

Among the least upbeat of all company calls

Answers to analysts: very upbeat, and more positive than the script.

Last call it was different: the answers were less upbeat than the script.

3 · What stood out

A packaging material supply constraint in Consumer Americas may reduce total McCormick & Company volume growth by up to 1 point in the fourth quarter.

Valuation

Is McCormick & Company undervalued?

Reverse DCF. Free cash flow from the last full fiscal year (2025-11-30), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.

At 2.5% growth a year (3-year revenue growth), the model's fair value is $18.88 a share — the stock trades 149% above it. Today's price assumes 10.1% growth a year.

Current price

$46.94

close of 2026-11-11

Market implies growth of i

+10.1% for 10 yrs

Fair value / share

$18.88

Buy below

$14.16

Price vs fair value

Overvalued 149%

Price vs buy-below price

Overvalued >200%

FCF growth / yr i Discount rate i Terminal growth i Margin of safety i

Official channels

The company's own website and social media accounts.

Read between the lines

Guidance

At the close of Unilever Foods, the company expects 21% operating margins and working capital benefits supporting 100% free cash flow conversion from net income before synergies.
Figure

Total sales grew by 17% in constant currency due to the McCormick de Mexico acquisition and 2% organic growth across Consumer and Flavor Solutions.

Source quote
“In the third quarter, total sales grew by 17% in constant currency, reflecting acquisition contribution from McCormick de Mexico and organic sales growth of 2%, reflecting growth across Consumer and Flavor Solutions.”
Guidance

MKC maintains its full-year gross margin expansion expectation of 100 to 120 basis points versus 2025 and now expects to be at the high end of that range.
Key theme

A packaging material supply constraint in Consumer Americas may reduce total company volume growth by up to 1 point in the fourth quarter, impacting expected volume shipments.

Source quote
“In addition, in Consumer Americas, we are managing a short-term industry supply constraint on a specific type of packaging material. This may have a negative impact of up to 1 point on total company volume growth for the fourth quarter, potentially impacting the expected improvement in volume shipments.”
Key theme

Asia Pacific delivered strong volume growth that exceeded expectations due to new product launches and limited time offers with QSR customers.

Source quote
“In Asia Pacific, we delivered strong volume growth that exceeded expectations, supported by new product launches and limited time offers with QSR customers.”

4 more

Figure

Integration planning is advancing on schedule and is increasingly validating the strategic and financial rationale for the combination.
Figure

The company returned $387 million to shareholders through dividends and spent $131 million on capital expenditures to expand capacity, advance digital transformation, and optimize cost structure.

Source quote
“This strong cash generation enabled us to return $387 million of cash to shareholders through dividends and used $131 million for capital expenditures to expand capacity, advance digital transformation and optimize our cost structure.”
Figure

Consumer organic sales in the Americas were flat because a 2% pricing contribution was offset by a volume decline.

Source quote
“Consumer organic sales in the Americas were flat with pricing contribution of 2%, offset by volume decline.”
Guidance

MKC raised its full-year cost inflation forecast to 6% to 7% from a prior expectation of a mid-single-digit year-over-year increase.

Tone

How upbeat the language was, compared with other companiesi. Dot: Q3 2026. Ring: Q2 2026.

Prepared remarks Cautious (was upbeat)

Answers to analysts Very upbeat (was cautious)

Management was more positive answering analysts than in its script — usually a sign it was comfortable with the details it was asked about.

Sentences that drove the tone

“In EMEA, organic sales were up 1%, driven by price offset by lower volume, reflecting soft QSR customers' volumes due to declining foot traffic, particularly in the U.K.”

“And then when you look at so it's going to be a tailwind into Q4, a headwind was a tailwind in Q3, it's going to be a headwind into Q4.”

“In the Americas, as I mentioned earlier, we experienced softer demand as macroeconomic pressure affected select CPG and QSR customers.”

Full figures

USD · SEC EDGAR XBRL (10-Q, period end 2026-08-31)

Metric	Q3 2026period end 2026-08-31	Q2 2026period end 2026-05-31	Change	Q3 2025	YoY
Revenue	2.02B	1.94B	+4.6%	1.72B	+17.4%
Gross profit	794.9M	778.2M	+2.1%	645.1M	+23.2%
Operating income	217.0M	276.4M	−21.5%	288.7M	−24.8%
Net income	97.6M	150.1M	−35.0%	225.5M	−56.7%
EPS	0.36	0.56	−35.7%	0.84	−57.1%
P/E today 8.8	9.8	7.9	+1.9	24.4	−14.6

Topics

Most discussed now

Despite improving dollar and unit trends, McCormick & still has room to improve performance, especially in areas like cooking blends and...
McCormick & is confident that it is making progress to strengthen velocity across the core portfolio, expand consumer conversion behind…
Portfolio and assortment optimization to better serve distinct consumer needs and improve shelf productivity, targeted pricing, promotional…
This strengthens McCormick &'s capacity to continue investing in its brands, innovation and capabilities, reinforcing sustainable growth…
The increase was driven primarily by volume and reflects the continued gradual recovery in China.

Faded since Q2 2026

Fading McCormick & expects sequential volume improvement in the third quarter and volume growth in the fourth...
Fading For the quarter, adjusted operating income increased by 30%, or 27% in constant currency.
Fading McCormick & delivered robust sales growth, expanded underlying margins, and increased earnings.
Fading In EMEA and Asia Pacific, McCormick & delivered sustained volume growth during the quarter, and it expects that momentum to continue...

Latest announcements

Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.

2026-10-01 Results of operations · SEC 8-K
Net sales increased 17.4% in the third quarter of 2026, while operating income was $217 million compared to $289 million in the year-ago period.
2026-09-28 Auditor change · SEC 8-K
McCormick & Company, Incorporated dismissed Ernst & Young LLP as its independent registered public accounting firm on September 24, 2026, and appointed KPMG LLP as its new independent registered public accounting firm.
2026-08-28 Director or officer change · SEC 8-K
Anne Bramnan will resign from the McCormick & Company Board and Audit Committee chairmanship on November 30, 2026, following her appointment as CFO of Best Buy Co., Inc.
2026-06-25 Results of operations · SEC 8-K
Net sales increased 16.7% in the second quarter, while operating income rose to $276 million from $246 million in the year-ago period.
2026-05-26 Director or officer change · SEC 8-K
McCormick & Company, Incorporated announced the appointment of Cindy Hoots to its Board of Directors effective June 1, 2026, for a board that will consist of 12 directors.
2026-05-01 Material agreement; New financial obligation; Other events · SEC 8-K
McCormick entered into a Term Loan Agreement and previously secured a bridge term loan credit facility for up to $15.7 billion, of which $2.0 billion was terminated on April 28, 2026.
2026-04-17 Director or officer change · SEC 8-K
Andrew Foust was appointed Chief Integration Officer to lead the Unilever foods business integration, while Patrick Davis was appointed Interim President Americas.
2026-04-03 Shareholder vote results · SEC 8-K · routine

Catalyst calendar

management-stated targets — from the latest earnings call; plans, not promises.

2026

outlook

Source quote
“We are confident in our ability to deliver on our 2026 outlook.”
the balance of the year

volume growth

Source quote
“Continued customer diversification should support solid volume growth for the balance of the year, though at a more normalized rate than in the third quarter.”
fourth quarter

impact of packaging material constraint on volume growth

Source quote
“This may have a negative impact of up to 1 point on total company volume growth for the fourth quarter, potentially impacting the expected improvement in volume shipments.”
fourth quarter

persistence of soft foot traffic and consumer pressure

Source quote
“We expect some of these trends to be sustained in the fourth quarter as foot traffic with QSRs remained soft and consumers remain pressured.”
through the balance of the year

persistence of pressures among QSRs and CPG customers

Source quote
“In Flavor Solutions, we expect the current pressures, particularly among certain QSRs in the Americas and EMEA and large CPG customers in the Americas to persist through the balance of the year.”