Mondelez International (NASDAQ:MDLZ), an S&P 500 (SPX) stock, can sweeten your portfolio returns, as per analysts. Mondelez is one of the largest snack companies in the world, selling a range of products such as biscuits, chocolate, candy, cheese, groceries, and beverages. In the past year, MDLZ stock has lost 3.6%. Most analysts see the pullback in the shares as an attractive opportunity to buy MDLZ stock.
Mondelez is a consumer defensive stock, meaning that the company tends to do well even during uncertain macroeconomic times. Mondelez is currently facing higher cocoa prices, which it has been able to pass on to customers for a while now. With inflation expected to ease, the company’s bottom line could improve faster.
MDLZ is slated to report its Q1 FY24 results on April 23, 2024. The Street expects the company to post adjusted earnings of $0.89 per share on revenue of $9.20 billion.
DBS Analyst Favors MDLZ Stock
On March 31, DBS analyst Zheng Feng Chee reiterated a Buy view on MDLZ stock and retained the price target of $78 (14.8% upside). Chee is impressed by Mondelez’s high single-digit adjusted EPS (earnings per share) growth forecast and expectations of organic net revenue growth between 3% and 5% for Fiscal 2024.
Furthermore, the bottom line is expected to grow faster than the top line as the company seeks to moderate costs, optimize ad spend, and improve overall productivity. Also, despite the high cocoa prices, Chee believes Mondelez will be able to command market share by continuing to pass on higher prices to customers without sacrificing the sales volume.
Mondelez’s Robust Financials
Mondelez has beaten analysts’ expectations for eight consecutive quarters. In Fiscal 2023, net revenues rose 14.4% while adjusted EPS grew 14.3% to $3.19.
Moreover, Mondelez rewarded shareholders with $3.7 billion of share buybacks and dividends. The company also raised the dividend per share by 10%. Meanwhile, Mondelez divested its gum business for $1.4 billion in 2023 as part of its efforts to focus on the core categories of chocolates, biscuits, and baked snacks.
Is Mondelez a Good Stock to Buy?
With 17 Buys versus one Hold rating, MDLZ stock has a Strong Buy consensus rating on TipRanks. The average Mondelez International price target of $83.47 implies 22.8% upside potential from current levels.
Notably, MDLZ also pays a regular quarterly dividend of $0.42 per share, reflecting an above-average yield of 2.31%.
Ending Thoughts
Mondelez International is one of the best consumer defensive stocks to fortify your portfolio. With a wide moat and well-established business, MDLZ stock has won the favor of Wall Street analysts. Analysts expect the company to grow strongly in the coming quarters and expect more than 20% share price appreciation in the next twelve months.
