Should You Buy McCormick Stock At This Price

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McCormick (MKC) stock trades at 8.6 times earnings, against 22.8 for the median S&P 500 company. Part of that discount comes from fiscal Q1 2026, when McCormick booked a $1,022 million profit on $253 million of operating income. The shares also lost 22.7% over the past year as the S&P 500 gained 11.9%. These figures leave McCormick looking like either a spice business on sale or a fair price for one that has stopped delivering. So how cheap is McCormick on a measure that one quarter's profit does not touch?

McCormick Stock Is The Cheapest On Sales Since 2016

At the end of September 2026, buyers paid 1.6 times McCormick's last twelve months of sales. That marked the lowest multiple at any quarter end since late 2016. Two years earlier, buyers paid 3.3 times sales.

The business behind that price still earns. McCormick sells herbs and spices to shoppers through its Consumer segment, which generated 57.8% of fiscal 2025 revenue. It also sells flavors to food makers and restaurant chains through Flavor Solutions. The company posted a 16.4% operating margin over the twelve months to August 2026, up from 16.0% a year earlier.

Over those same twelve months, McCormick produced $926 million of free cash flow. This was enough to cover the $529 million it paid in dividends. At the November 3 close, the dividend alone yielded 4.1%. That is the value case: a business that still earns and pays out cash, trading at a discount to both the market and its own past. On the November 3 price, McCormick traded at 1.7 times sales, against 3.2 for the S&P 500 taken as one company.

McCormick's Own Business Is Growing About 2%

Sales from the businesses McCormick already owned grew 2% in fiscal Q3 2026, management said on the October 1 call. Total sales rose 17% in constant currency that quarter, with McCormick de Mexico, a business it acquired, accounting for the rest.

The faster pace is new. Revenue grew 13.2% over the twelve months to August 2026. In the twelve months before that, revenue grew just 1.6%.

Management described a value-conscious consumer environment. Consumer organic sales in the Americas were flat in the quarter, with volumes pressured by the macro environment. At the same time, softer demand from packaged food and restaurant customers weighed on volumes in Flavor Solutions. Adjusted earnings per share, management's own measure, rose 1% to $0.86. The acquisition has lifted McCormick's sales, but the slow growth underneath has not gone away.

What McCormick Is Doing To Grow Again

Management is working on two fronts. For its core brands, McCormick launched new pack sizes and prices on its Grill Mates and cooking blends lines while spending more on search. However, management said the recovery in recipe mixes is taking a little longer than it expected.

The bigger move is buying Unilever Foods. Management expects McCormick to have industry-leading operating margins of 21% at the close. That deal adds debt. McCormick's leverage ratio was about 2.9 times at the end of fiscal Q3 2026. Management expects that ratio to hit 4 times when the deal closes, falling to 3 times within two years. Total debt already equals 38.9% of McCormick's market value, against 19.2% for the S&P 500.

A buyer at $47.88 is not mainly betting that the market has mispriced a sound business. The bet is that management lifts growth in the business it already owns and delivers the margins it expects once the deal closes while it pays down debt. Organic sales growth is the number to watch when McCormick reports in January 2027, with management expecting it between the low end and midpoint of its 1% to 3% range for fiscal 2026.

Beyond MKC: A Systematic Way To Invest

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