1. Mondelez International, Inc. (NASDAQ:MDLZ)
Number of Hedge Fund Holders: 47
Mondelez International, Inc. (NASDAQ:MDLZ) is a global leader in the snacking industry, with its products reaching over 150 countries. Its diverse portfolio includes beverages, biscuits, chocolate, gum, candy, cheese, and groceries. Mondelez owns renowned brands such as Ritz, LU, Clif Bar, and Tate’s Bake Shop, along with popular chocolate brands like Cadbury Dairy Milk, Milka, Toblerone, and Oreo. It tops our list of the best chocolate stocks to buy now.
In July 2024, Mondelez International, Inc. (NASDAQ:MDLZ) announced the recruitment of 48 sensory panelists at its Bournville site to help refine the taste profiles of iconic brands like Cadbury, Toblerone, and Milka. The goal is to stay competitive and adapt to changing consumer preferences in the chocolate industry.
In Q2 2024, Mondelez International, Inc. (NASDAQ:MDLZ) reported a 1.9% dip in net revenue to $2.8 billion, largely due to unfavorable currency impacts and the 2023 divestiture of its gum business. However, organic net revenue grew by 2.5%, driven by effective pricing strategies. Operating income decreased by $571 million, mainly due to unfavorable YoY changes in hedging activities, divestitures, and higher integration costs. EPS rose 25% to $0.86, boosted by product innovations and strong investments in emerging markets.
Furthermore, in the first six months of 2024, the free cash flow generated was $1.5 billion, showcasing a healthy liquidity position that enabled Mondelez to raise its dividend by 11% in Q2 2024. It returned $2.2 billion to shareholders in cash dividends, translating into a quarterly dividend payment of $0.47 per share.
On the other hand, Mondelez International, Inc. (NASDAQ:MDLZ) experienced a 7.21% increase over the past month and a 4.37% rise YTD. This growth is largely due to the company’s strategic divestitures and acquisitions. Additionally, cost-saving measures under the Simplify to Grow Program further strengthen Mondelez’s position for continued growth.
Despite strong Q2 results, the company faces challenges with softness in the U.S. biscuit segment, rising cocoa costs, and competitive pressures in markets such as India, which may impact profitability going forward.
Analysts have projected an upside potential of 5.63% from the current price of $75.53. As of Q2 2024, 47 hedge funds, holding a combined investment of $1.6 billion, remain bullish on the stock, as per Insider Monkey’s database.
MDLZ is the best chocolate stock to buy now based on hedge fund sentiment. While we acknowledge the potential of MDLZ as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than MDLZ but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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