Kellanova (K), headquartered in Chicago, Illinois, manufactures and markets snacks and convenience foods. Valued at $27.3 billion by market cap, the company offers snack products such as snacking, cereal, noodles, plant-based foods, and frozen breakfast with online delivery services.
Companies worth $10 billion or more are generally described as “large-cap stocks,” and Kellanova perfectly fits that description, with its market cap exceeding this mark, underscoring its size, influence, and dominance within the packaged goods industry. Kellanova's diverse and recognized brand portfolio, including Pringles, Cheez-It, and Eggo, provides a strong market presence and consumer loyalty. With products manufactured in 20 countries and marketed in over 180, the company's global footprint allows it to access different consumer markets and reduce risks from economic fluctuations in any single region.
Despite its notable strength, K slipped 5.5% from its 52-week high of $83.22, achieved on Mar. 4. Over the past three months, K stock declined 4.5%, underperforming the S&P 500 Index’s ($SPX) 5.4% rise during the same time frame.
In the longer term, shares of K dipped 2.8% on a YTD basis, underperforming SPX’s YTD gains of 1.5%. However, the stock climbed 36.3% over the past 52 weeks, outperforming SPX’s 9% returns over the last year.
Despite the positive price momentum, K has been trading below its 50-day and 200-day moving averages since mid-June.
Kellanova’s growth in emerging markets has led to its outperformance.
On May 1, K shares closed up marginally after reporting its Q1 results. Its revenue stood at $3.1 billion, down 3.6% year over year. The company’s adjusted EPS declined 10.9% from the year-ago quarter to $0.90.
K’s rival, General Mills, Inc. (GIS) shares lagged behind the stock, declining 16.9% on a YTD basis and 20.5% over the past 52 weeks.
Wall Street analysts are cautious on K’s prospects. The stock has a consensus “Hold” rating from the 16 analysts covering it, and the mean price target of $83.17 suggests a potential upside of 5.7% from current price levels.
