MDLZ

Mondelez International Inc

Consumer


Presented:11/08/2017
Price:$41.60
Cap:$63.40B
Current Price:$71.80
Cap:$95.91B

Presented

Date11/08/2017
Price$41.60
Market Cap$63.40B
Ent Value$79.82B
P/E Ratio28.89x
Book Value$17.41
Div Yield1.38%
Shares O/S1,524.00M
Ave Daily Vol8,652,596
Short Int1.09%

Current

Price$71.80
Market Cap$95.91B
Mondelez International, Inc. engages in the manufacture and marketing of snack food and beverage products. The company operates its business through following segments: Latin America; Asia, Middle East, and Africa; Europe; and North America. Its products include beverages, biscuits, meals, chocolate, and gum and candy. Its brands include but not limited to Nabisco, Oreo, and LU biscuits; Cadbury, Cadbury Dairy Milk, and Milka chocolates; and Trident gum. Mondelez International was founded by James Lewis Kraft in 1903 is headquartered in Deerfield, IL.

Publicly traded companies mentioned herein: Campbell Soup Company (CPB), Hershey Co (HSY), Mondelez International Inc (MDLZ), Nestle SA (NESN SW)

Highlights

The presenter is long shares of Mondelez (MDLZ) and sees the stock trading at an attractive level ($41) following a selloff from recent highs ($47) on concerns about the CEO’s retirement, operational issues (the end of Q2 cyber attack), and the selloff in US food companies. He views these issues as transitory and noted that MDLZ’s business is split 75% international and 25% US. With 40-45% of sales to Emerging Markets where the pricing cycle is favorable, margins can expand as volume rebounds. At the same time, comps will be easier due to the hack, and its primary input costs (sugar and cocoa) are down 15-20%. If his assessment of the setup and outlook are accurate, M&A could provide some optionality and MDLZ shares would be more fairly valued at $55 (20x his 2019 EPS forecast).

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