You might have not heard of American food and beverage company Mondelez International, but you would have definitely seen at least an advertisement for the Oreo cookie. Well, Mondelez is Oreo’s parent. Earlier known as Kraft Foods, it has previously seen investment from the likes of Warren Buffet. Today, Mondelez stock has once again caught the eye of discerning investors.
Executive vice president and chief supply-chain officer for Mondelez Sandra MacQuillan’s ambitious plans to modernize the snack food giant are bold and promising. Her strategies have carried Mdlz stock through the pandemic and is expected to be sturdy enough to weather future storms.
Mondelez owns brands like Oreo, belVita, Milka, Wheat Thins, and LU biscuits. (The Mondelez International Headquarters in Illinois; Image Credit – Mike Mitchell/ Wikimedia Commons)Modelez Stock Growth and Performance
The Mondelez stock has performed decently well over the years as the company offers a little bit of something for regional and international customers. Despite a record high inflation, Mondelez has continued to do well. One reason for this is the change in Americans’ snacking habits. The company’s research showed that nearly 90% of people around the world snack on a daily basis, with a frequency that keeps increasing.
In an interview with The Wall Street Journal, MacQuillan revealed that the company is driving segmentation across all products. She stated that knowing which products belong to tier A, B, and C is important to deliver a customer-centric service.
She also discussed Factory 2025, wherein she is pushing for digitization. The goal for the company is to move towards having a no-touch factory and a no-touch distribution center within the next five years. MacQuillan is also working to remove bottlenecks in the supply chain.
In keeping with the times, Mondelez is also focusing on building a $1 billion+ snack bar business. By acquiring Clif Bar, the company has positioned itself as a top contender in the health food market with its well-being snack bars.
Russia’s invasion of Ukraine has affected business for the international snack-maker. Last quarter, the company reported that the war cost the company $145 million in damaged property among other expenses.
The Mondelez Future
As of October 24, Mondelez stock had hit $58.74, slightly lower than the almost $62 it hit in July. However, Mdlz stock has come a long way from its $40 per share at the end of 2018.
Over the course of these years, the Mondelez stock price has also been buoyed by a rise in price-to-sales ratio. On July 26, the company released its second quarter 2022 results and raised its full-year revenue growth outlook. CEO Dirk Van de Put stated, “Our chocolate and biscuit businesses continue to demonstrate strong volume growth and pricing resilience across both developed and emerging markets. These results combined with ongoing cost discipline, simplification and revenue growth management are delivering robust profit dollar growth and strong cash flow, enabling us to increase our dividend by 10 percent.” Having consistent results has also pushed the company towards making substantial reinvestments.
Mdlz stock is expected to rise as the company continues to bring in greater revenue. Its global net revenues totaled $28.7 billion in 2021. In the last six years, its operating margin has gone from 12% to 13.6%. For Q2 of 2022, the company reported $0.67 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.64 by $0.03.
In recent months, institutional investors and hedge funds have added Mdlz stock to their kitty, including Stack Financial Management, Capital International Sarl, and Ledyard National Bank. Although Mondelez share price has fluctuated a bit, investors prefer Mondelez stock for its dividend payouts. Experts see investing in the company as a moderate-to-high risk strategy but with quarterly dividends, it is a good source of passive income.
According to Dividend.com, Mondelez has a 10% dividend CAGR in the last three years. The company is expected to announce its Q3 earning reports around November 2.
