McCormick is an American food company specializing in condiments, flavorings, and spices. It has an extensive portfolio of brands through which it sells products in over 160 countries. McCormick has been around for 130 years and has deep expertise in its segment. Its customers include quick-service restaurants, packaged food manufacturers, and grocery retailers. McCormick benefits from moats like economies of scale and strong brand power. The demand for food products also tends to be stable and recession-resistant. Therefore, the long-term growth prospects of the company appear to be solid.
The long-term monthly chart for McCormick shows a steady uptrend since 2011. The stock has consistently made higher tops and higher bottoms with relatively minor pullbacks along the way. The last major pullback occurred in March 2020, when the price briefly broke the bottom trend line. However, the stock recovered swiftly and rose 100% from the March bottom to hit a high of $105 in September 2020. Since then, the price has been in a downtrend though found support at $84.55. Currently, the price is at this support zone and also close to the bottom trend line. Therefore, a reversal is likely. Intermediate target prices $91, $96, and $99. A stop-loss can be placed below the bottom trend line at $80.
Position entered into our long-term tracking portfolio today. The entry point is at $87.75, and stop-loss $75.03, which is 12% below the entry point. The short-term to medium-term take profit at the top of the trend is set at $98.58, giving a profit of 12%.