Mondelez International -- The Essentials

Now trading at a price of $69.81, Mondelez International moved -0.9% Friday.

Mondelez International shares moved 9.8% over the last 52 weeks, with a high of $71.85 and a low of $54.72. During this time, the stock outperformed the S&P 500 index by 16.0%. As of January 2022, the company's 50-day average price is $67.0. Mondelez International, Inc., through its subsidiaries, manufactures, markets, and sells snack food and beverage products in the Latin America, North America, Asia, the Middle East, Africa, and Europe. The large-cap Consumer Staples company has 91,000 full time employees and is based in Chicago, IL. Mondelez International has returned a 2.1% dividend yield over the last 12 months.

Snapshot of the Company's Consistent Operating Margins:

2019-12-31 2020-12-31 2021-12-31 2022-12-31
Revenue (MM) $25,868 $26,581 $28,720 $31,496
Revenue Growth n/a 2.76% 8.05% 9.67%
Gross Margins 40.0% 39.3% 39.2% 35.9%
Gross Margins Growth n/a -1.75% -0.25% -8.42%
Operating Margins 15.6% 15.6% 16.9% 12.0%
Operating Margins Growth n/a 0.0% 8.33% -28.99%
Net Margins 14.96% 13.37% 14.97% 8.63%
Net Margins Growth n/a -10.63% 11.97% -42.35%
Earnings Per Share $2.65 $2.47 $3.04 $1.94
EPS Growth n/a -6.79% 23.08% -36.18%
Diluted Shares (MM) 1,458 1,441 1,413 1,363
Free Cash Flow (MM) $3,040 $3,101 $3,176 $3,002
FCF Growth n/a 2.01% 2.42% -5.48%
Capital Expenditures (MM) -$925 -$863 -$965 -$906
Net Debt / EBITDA 3.34 3.04 2.59 4.19

Mondelez International Is Too Expensive at Current Levels:

Compared to the Consumer Staples sector's average of 24.36, Mondelez International has a trailing twelve month P/E ratio of 36.0 and, according to its EPS guidance of 3.43, an expected P/E ratio of 20.4. Mondelez International's PEG ratio is 5.2 based on its 6.7% compound average growth rate of historical and projected earnings per share. This suggests that the company's shares are overvalued.

However, Mondelez International is likely undervalued in terms of its equity because its P/B ratio is 3.5 compared to its sector average of 4.29. The company's shares are currently trading 109.0% above their fair value as expressed by Benjamin Graham's formula:

√(22.5 * 4-year average EPS * book value per share) = √(22.5 * 2.52 * 19.682) = $33.41

Mondelez International Is the Subject of Mixed Market Indicators:

22 analysts are following Mondelez International and have set target prices ranging from $70.0 to $80.0 per share. On average, they have given the company a rating of buy. At the current price of $69.81, MDLZ is trading -7.48% away from its average analyst target price of $75.45 per share, implying an analyst consensus of some upside potential for the stock.

The company has a very low short interest since 0.9% of the company's shares are tied to short positions. Institutions own 82.0% of Mondelez International's shares, while the insider ownership rate stands at 0.16%. The biggest shareholder is the Vanguard Group, Inc. with a 9% stake in the company worth approximately $8,556,596,391.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.