Mondelez Stock (NASDASQ:MDLZ)
Mondelez International, Inc. (NASDASQ:MDLZ) has seen increased success as a result of the success of its snack business. In conjunction with the release of its fourth annual State of Snacking report, the firm underlined that customers continue to emphasize snacking, despite the fact that expenses have increased and economic headwinds are there.
A survey of consumer attitudes and actions in 12 nations showed a growing preference for snacking, gradually taking the place of traditional meals at an increasing rate. Mondelez is in a good position to succeed with its attempts to strengthen its position in the snacking category in light of these trends. I rate Mondelez stock as a Buy.
Mondelez Is Committed to the Snacking Industry
Mondelez has always wanted to grow its business through strategic collaborations and acquisitions. The company has been putting a lot of effort into increasing its snacking area.
Mondelez’s main categories, which include chocolates and biscuits, have historically demonstrated resilience in the face of economic downturns and pricing moves. This is because people choose snacking over traditional meals. Chocolates and biscuits are among the most highly appreciated snack foods among customers in industrialized nations since they are seen as cheap forms of pleasure.
Mondelez reported in its financial release for the third quarter that it had completed the buyout of Ricolino, which is anticipated to increase the size of its Mexico business by a factor of two. It was completed in August of 2022 that they bought out Clif Bar. The company’s management announced more investments in the Cocoa Life program and increased their goal to source all cocoa volumes from the Cocoa Life initiative by 2030.
The integration of the Chipita S.A. business, which Mondelez purchased in January 2022 and is a key producer of both sweet and salty snacks in Central and Eastern Europe, has been successfully completed by Mondelez. The positive effects of this acquisition on net revenues were particularly noticeable during the third quarter of 2022.
Grenade, a well-known brand in sports performance and active nutrition, was acquired by Mondelez in 2021. In addition, the business purchased Gourmet Food Holdings, a luxury biscuit and cracker manufacturer in Australia. Gourmet Food Holdings is one of the companies that the corporation operates.
On January 4, 2021, Mondelez successfully finalized the acquisition of Hu Master Holdings, the parent company of Hu Products. The company acquired a controlling stake in the industry pioneer Give & Go, which specializes in fully finished sweet-baked items. This transaction took place in April 2020.
The fact that Mondelez is concentrating on making acquisitions to expand its scale in its product categories and distribution capabilities is encouraging. Mondelez is dedicated to shifting its attention to businesses with greater potential for expansion. In 2021, the firm sold its beverage assets and invested the net proceeds in the company’s various brands and growth drivers. The sale of the beverage assets occurred.
Wrapping Up
Mondelez is expected to succeed if it maintains its current strategy of concentrating on markets with higher demand, such as snacking. The management anticipates an increase in organic net revenues of more than 10% for 2022. It forecasts a growth of 10% in adjusted profits per share, also known as EPS, when measured in constant currency.
In comparison to the growth of the industry, which was 6.2% during the past three months, Mondelez stock has increased by 11.3%.
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