McCormick Is Too Spicy

Have you been watching the shares of spice maker McCormick (MKC)? With investors focused on consistent dividend payers, the shares have been muy caliente! But can a company that just makes spices really support a parabolic stock price? I mean, these are spices, not iPhones!

Yet the shares of McCormick have been red-hot. Year-to-date, the stock has returned 26%, not including dividends. In 2006, the company decided to aggressively ramp up its research-and-development (R&D) and deal-making machines. By 2012, this strategy has begun to pay off. For example, McCormick will introduce over 225 new products this year. Two-thirds of McCormick's sales are composed of branded products that are No. 1 in their category. The company's enviable position has produced a consistent 10-year annualized revenue growth rate of 6.7%. Over this time, earnings per share (EPS) have grown at an 11% rate....207 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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