Analyst: McCormick Looks To Expand In China, India

Spice and seasonings maker is talking more about potential acquisitions now and could be ripe for a deal in emerging markets like China or India, an analyst said.

NEW YORK (AP) -- Spice and seasonings maker McCormick & Co. is talking more about potential acquisitions now and could be ripe for a deal in emerging markets like China or India, an analyst said Wednesday.

The company hosted an analyst meeting this week in Baltimore, near its headquarters of Sparks, Md. Barclays Capital analyst Andrew Lazar said the meeting has given him more confidence in the company's direction and its ability to meet targets.

"In our view, there do not appear to be any major shifts in core strategies, though a more aggressive acquisition posture seems likely," Lazar told clients in a note.

He said the company has completed its buyout of Lawry's, which it bought in 2008.

It's possible a new deal could take place in an emerging market like China or India, he said. He noted that the company typically enters those markets by way of its foodservice, or industrial, customers but now seems more willing to make deals in the consumer sphere first.

Lazar also said he looks to improvement in consumer margins because of the company's plan to reinvent its marketing there.

"To us, this strategy of increased spending makes sense, particularly at a time when competitors are having a tougher time keeping pace on the marketing side," he wrote.

Lazar maintained his "equal weight" rating on the stock and his $40 target share price.

Shares of McCormick fell 16 cents to $38.25 in afternoon trading Wednesday.

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