Bernstein SocGen Group recently adjusted its price target on McCormick (NYSE:MKC) downwards to $85.00 from an earlier $87.00, though it maintained an Outperform recommendation on the stock. This downward revision follows McCormick’s issuance of fiscal year 2026 guidance that Bernstein SocGen characterized as underwhelming.
The guidance projects organic sales growth in the range of 1% to 3%, which falls roughly 70 basis points short of consensus estimates that have set expectations at approximately 2.7% growth at the midpoint. Earnings per share (EPS) forecasts also came in below consensus, with McCormick projecting EPS between $3.05 and $3.13. This midpoint is 4.3% less than prevailing analyst estimates of $3.23, a discrepancy that Bernstein SocGen notes has influenced recent fluctuations in the stock price.
Several factors are expected to constrain McCormick’s earnings expansion in the near term. These include a 3% drag from an increased tax rate, as well as a 4% impact linked to management’s choice to accelerate the digital transformation rollout schedule, a move anticipated to alleviate pressure in 2027 and 2028. Additionally, the company anticipates a rebound in incentive compensation expenses and a projected mid-to-high teens percentage increase in brand marketing spend, both contributing further to cost pressures.
In related developments, McCormick & Company’s fourth-quarter results missed organic sales expectations, primarily within its Americas Flavor Solutions segment. This shortfall was partially attributed to inventory reductions by a Mexican consumer packaged goods customer. Consequently, Bank of America Securities trimmed its McCormick price target from $89.00 to $80.00 but upheld a Buy rating.
Separately, the pharmaceutical distributor McKesson also experienced mixed analyst reactions following its recent quarterly performance. Jefferies lowered its price target to $74.00 from $79.00 after McKesson missed fourth-quarter earnings and provided lighter guidance for 2026, citing sustained inflationary cost pressures as a concern. In contrast, TD Cowen maintained a Buy rating and a $1,000 price target, highlighting optimism about McKesson’s growth prospects driven by demographic trends and pharmaceutical innovation.
Further support for McKesson came from Leerink Partners, which raised its price target significantly to $965 from $850 after strong segment performances, and Evercore ISI, which increased its target to $1,000 from $825, noting robust results in the North American Pharmaceutical division and anticipated operating income growth.
These diverse analyst perspectives illustrate the current complexity and varying outlooks within sectors impacted by consumer goods and healthcare distribution dynamics.