International Flavors & Fragrances Inc. IFF recently announced that its Frutarom Division has completed the previously announced buyout of 60% share capital of Thailand-based leading savory solutions company — The Mighty CO. LTD. (“Mighty”).
Established in 1989, Mighty produces, develops and markets reaction flavors, with a proficiency in savory solutions. The company has a portfolio of marinades, seasoning blends, flavors and specialty functional raw materials for the food and beverage industry.
The deal is in sync with Frutarom Division’s growth strategy in Southeast Asia as well as pursuing attractive companies. Moreover, the company is committed to grow its capabilities in savory solutions.
Shares of the International Flavors have underperformed the industry over the past year. The stock has lost around 9.8% compared with the 7.4% decline of the industry during the same period.
In October 2018, the company completed the acquisition of Frutarom, an Israeli company that develops, produces and markets flavors and fragrances with expansion into fast-growing categories, like savory solutions, natural colors, natural food protection and health ingredients. Together, International Flavors and Frutarom creates a global leader in natural taste, scent and nutrition with a broader customer base, more diversified product offerings and increased exposure to end markets, including those with a focus on naturals and health and wellness. Frutarom is expected to prove accretive to International Flavors’ fourth-quarter top and bottom-line results.
Moreover, International Flavors will gain on cost-cutting efforts, productivity initiatives and growth in global market for flavors and fragrances, despite input cost inflation, disruptions in the supply chain and high debt levels.
Internationa Flavors & Fragrances, Inc. Price and Consensus
Internationa Flavors & Fragrances, Inc. Price and Consensus | Internationa Flavors & Fragrances, Inc. Quote
Zacks Rank & Stocks to Consider
International Flavors currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the basic materials space are Ingevity Corporation NGVT, Israel Chemicals Ltd. ICL and Cameco Corporation CCJ each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Ingevity’s shares have gained 22.3% in the past year. The company has an expected earnings growth rate of 21.5% for 2019.
Israel Chemicals has an expected earnings growth rate of 2.7% for 2019.The stock has rallied 32.7% in a year.
Cameco has an expected earnings growth rate of 20% for 2019. Its shares have gained 23% in a year.
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