MDLZ At Price Support Zone, Right Time To Buy?
Mondelez International (MDLZ) should be on your watchlist. Here is why – it is currently trading in the support zone ($58.39 – $64.53), levels from which it has bounced meaningfully before. In the last 10 years, the stock received buying interest at this level 6 times and subsequently went on to generate 15.1% in average peak returns.
| Peak Return | Days to Peak Return | |
|---|---|---|
| 11/2/2022 | 9.3% | 65 |
| 1/6/2023 | 15.8% | 125 |
| 10/11/2023 | 22.9% | 114 |
| 4/10/2024 | 7.9% | 20 |
| 6/14/2024 | 15.7% | 87 |
| 2/11/2025 | 18.7% | 161 |
But is the price action enough alone? It certainly helps if the fundamentals check out. For MDLZ Read Buy or Sell MDLZ Stock to see how convincing this buy opportunity might be.
Here are some quick data points:
- Revenue Growth: 3.1% LTM and 7.6% last 3 year average.
- Cash Generation: Nearly 7.7% free cash flow margin and 13.1% operating margin LTM.
- Recent Revenue Shocks: The minnimum annual revenue growth in last 3 years for MDLZ was 3.1%.
- Valuation: MDLZ trades at a PE multiple of 23.0
- Opportunity vs S&P: Compared to S&P, you get lower valuation, higher 3 year average revenue growth, and lower margins
Mondelez International provides snack foods and beverages worldwide, including biscuits, chocolates, gums, and candies, with brands like Cadbury, Milka, and Toblerone.
- Is HCA Healthcare Stock Utilizing Systematic Share Retirement for Long-Term Alpha?
- Is Booking Stock Undervalued Stock Or Value Trap?
- Decoding PLTR Stock’s Premium Valuation
- Intuit Stock: Strong Cash Flow Poised for a Re-Rating?
- Five-Year Tally: Lowe’s Companies Stock Delivers $50 Bil Gain
- Five-Year Tally: Mastercard Stock Delivers $60 Bil Gain
| MDLZ | S&P Median | |
|---|---|---|
| Sector | Consumer Staples | – |
| Industry | Packaged Foods & Meats | – |
| PE Ratio | 23.0 | 23.5 |
|
|
||
| LTM* Revenue Growth | 3.1% | 5.0% |
| 3Y Average Annual Revenue Growth | 7.6% | 5.8% |
| Min Annual Revenue Growth Last 3Y | 3.1% | -0.3% |
|
|
||
| LTM* Operating Margin | 13.1% | 18.8% |
| 3Y Average Operating Margin | 14.7% | 17.7% |
| LTM* Free Cash Flow Margin | 7.7% | 13.2% |
*LTM: Last Twelve Months
That is one way to look at stocks. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure
What Is Stock-Specific Risk If The Market Crashes?
That said, MDLZ isn’t immune to big dips. It lost nearly 40% in the Global Financial Crisis and about 30% during the Covid pandemic. Even the smaller shocks weren’t kind — around 19% in 2018 and 21% during the inflation shock. Good fundamentals matter, but when the market gets shaky, MDLZ can see sizable pullbacks too.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.