Mondelez International Inc

Jefferies warned that six consumer stocks could be disrupted by a Super El Niño this year and into 2027, part of a larger multi-sector list of names the firm identified as at risk. Current forecasts suggest the 2026-27 El Niño may be the strongest in modern history, and the firm noted that, unlike most climate risks, El Niño is highly trackable months in advance, giving investors an opportunity to identify economic consequences before they fully materialize. Analyst Scott Marks said Hershey carries concentrated cocoa exposure through its core U.S. chocolate portfolio and has built its 2027 margin recovery plan around expected cocoa deflation, warning that a Super El Niño driving a hotter, drier West African 2026/27 crop would undercut the central pillar of that recovery story. J.M. Smucker is exposed through its coffee portfolio, with sourcing potentially impacted for Brazilian arabica and Vietnamese and Indonesian robusta, while Mondelez International faces El Niño exposure through cocoa, with roughly 60% of supply in Côte d'Ivoire and Ghana, where strong events historically turn hotter and drier heading into the November-January harvest. Analyst Pedro Baptista noted PriceSmart derives approximately 11% of sales from Colombia and also operates across Central America, and analyst Anne Ling said Yum China could see extreme rainfall, flooding and adverse weather temporarily reduce dine-in traffic and disrupt logistics and delivery efficiency, while analyst Alex Wright highlighted that a sharp rise in sweetener costs could pressure margins at Coca-Cola FEMSA if cost increases outpace pricing actions.

Mondelez International is leaning on productivity and cost discipline to absorb elevated raw material costs, but those efficiencies have so far provided only a partial offset. In the second quarter of 2026, adjusted gross profit rose $92 million at constant currency, up 3%, and adjusted gross margin expanded 20 basis points to 34%, helped by higher net pricing and lower manufacturing costs from productivity. Further down the income statement, adjusted operating income fell 6.1% at constant currency and adjusted operating margin contracted 120 basis points to 13.1%. On a year-to-date basis, cocoa cost phasing weighed more heavily: adjusted gross profit declined 1.2% at constant currency, adjusted operating income fell 12.8% and adjusted EPS decreased 8.8%, with the company naming cocoa cost phasing as a primary factor. The Zacks Rank #3 (Hold) stock has risen 0.8% over the past year against an 18.6% decline for the industry, and trades at a forward price-to-earnings ratio of 19.04 versus the industry average of 14.66.

Poland's competition watchdog, UOKiK, is investigating Danone, Mondelez International, Nestlé, and Unilever over potential "shrinkflation" practices, examining whether they clearly inform consumers about reductions in product quantity or weight when packaging stays the same. The review covers food, cleaning, and personal care products sold in Poland, assessing if the companies' product information could mislead consumers into believing pack sizes have not changed. UOKiK president Tomasz Chróstny said that reducing weight without changing price effectively means consumers pay more, making price comparisons harder and undermining trust. The move follows an April ruling by the Court of Justice of the European Union in Case C-301/25, which confirmed that even compliant products can be assessed for misleading practices under unfair commercial practice rules. If evidence of consumer deception is found, UOKiK may open formal proceedings. Mondelez's Polish business confirmed cooperation with the regulator. This action follows France's 2024 rules requiring retailers to display notices when products shrink in size.

Cocoa prices are climbing again, with futures up 7.7% to $6,648.00 in early trading Monday, after sliding to as low as $2,846.00 in early March. The rebound is driven by renewed supply uncertainty for the 2026-2027 crop, particularly in Côte d’Ivoire and Ghana, as traders reassess expectations of a substantial surplus. Weather remains a key factor, with concerns over El Niño-related disruption and lower farmgate prices in those countries affecting farmer output and investment. Analysts also view part of the increase as a market correction, noting that futures below $3,000 per ton in late February reflected overly optimistic supply assumptions and overly pessimistic demand expectations. Companies exposed to cocoa price swings include Hershey, Mondelez International, Nestlé, and Barry Callebaut.

Mondelez International is progressing work on cell-cultured chocolate technology as part of its response to cocoa price volatility in 2026, while also announcing a nationwide recall of its Cadbury Dairy Milk Oreo Candy bar due to undeclared pistachio allergens. The stock last closed at $62.31, with returns up 3.0% over the past week and 5.0% over the past month. The move toward cell-cultured chocolate is an attempt to reduce exposure to volatile cocoa markets and protect margins over time, potentially opening new product formats if consumers accept chocolate that relies less on traditional cocoa supply chains. By contrast, the recall highlights operational and regulatory risk around ingredient control and labeling for a business built on trusted global brands. Recent Q2 2026 results showed higher sales and net income versus a year earlier, giving the company financial room to invest in both food safety systems and product development.

StockStory identifies Xylem as an S&P 500 stock worth attention while questioning Mondelez and United Airlines. Xylem, a water-sector company with a market cap of $29.78 billion, posted annual revenue growth of 12.7% over five years and earnings per share growth of 16.7% annually, with free cash flow margin expanding by 5.5 percentage points. Mondelez, the $78.84 billion snacks maker, faces falling unit sales, estimated sales growth of just 2.4%, and a 2% annual decline in earnings per share over three years. United Airlines, valued at $38.56 billion, has seen disappointing revenue passenger miles, a subpar operating margin of 8.2%, and an expected persistence of its free cash flow margin constraints.

StockStory highlights Vertex Pharmaceuticals as a Nasdaq 100 stock with huge potential while expressing caution on Workday and Mondelez. Vertex, with a market cap of $121.1 billion, posted 13.8% annual revenue growth over five years and a strong free cash flow margin of 24.7%. Workday, valued at $35.03 billion, faces slowing demand with estimated sales growth of 10.9% and trades at 3.3x forward price-to-sales. Mondelez, at a $75.38 billion market cap, saw earnings per share fall 2% annually over three years and has an estimated sales growth of just 2.4%, trading at 18.4x forward P/E.

Zacks Equity Research has identified Mondelez International, Sysco, United Natural Foods, and Mama's Creations as stocks to watch within the Food-Miscellaneous industry, which faces pressure from value-conscious consumers and persistent cost inflation. The industry carries a Zacks Industry Rank of 214, placing it in the bottom 13% of more than 247 Zacks industries, and its consensus earnings estimate for the current financial year has declined 2.7% since the beginning of May 2026. United Natural Foods holds a Zacks Rank of 1, or Strong Buy, with shares gaining 109.4% over the past year, while Mama's Creations is ranked 2, or Buy, and has rallied 115.2%. Mondelez and Sysco both carry a Zacks Rank of 3, or Hold, with Mondelez shares down 10.4% and Sysco shares up 9.2% over the same period.

Freedom Broker downgraded Mondelēz International from Buy to Hold on June 26, while maintaining its price target at $71, implying over 16% upside. The analyst firm cited historically negative impacts of commodity inflation on profitability and a muted stock response to cocoa prices hitting a five-month high. Cocoa is trading above $5,000 per ton amid concerns over the West African mid-crop harvest, and the company has remained prudent with its fiscal 2026 guidance given cocoa volatility and subdued US biscuit performance.

Mondelez shares slid 2.1% to close at $60.87 after the Federal Reserve held its benchmark rate at 3.5%–3.75% and released a dot plot pointing toward a possible hike. The 2-year Treasury yield jumped 11 basis points to 4.161%, narrowing the yield advantage that had made dividend stocks more attractive following late-2025 rate cuts. Packaged food companies like Mondelez, Kraft Heinz, and Conagra face additional pressure because their acquisition-related debt becomes more expensive to refinance when rate expectations rise.

Mondelēz International chairman and chief executive Dirk Van de Put warned that Britain’s tightening junk food regulations are making the country less attractive for investment and could cost it future factory projects. He told the BBC that constant regulatory changes create uncertainty and impose hefty costs, noting around a hundred different nutritional targets introduced in the past two decades. Van de Put said the UK is the company’s second-biggest market globally, but future decisions on where to build new European plants might not favour Britain. He also criticised the Government’s exclusion of food and drink manufacturing from its eight priority industrial strategy sectors, calling the omission weird given the industry accounts for about a quarter of Britain’s industrial turnover and supports roughly 500,000 jobs. Mondelēz, which owns Cadbury, Toblerone and Oreo, employs nearly 100,000 people worldwide and operates eight UK sites including the historic Bournville factory.