Stock Analysis: McCormick Stock Close 52 Week High But Could Be Full of Surprises

McCormick & Company, Incorporated (NYSE: MKC) was founded in 1889 and is the global leader in the manufacturing, marketing and distribution of spices, seasonings and flavorings to the entire food industry. It has its headquarters near Baltimore, Maryland. The company reported earnings on January 26, 2012, beat slightly on revenues and met expectations on earnings per share for the fourth quarter.

The stock is currently in a bullish trend. It has retraced about 3.4 % from its recent high price of $52.21 that occurred on January 19, 2012. The stock closed on Friday at 50.31, below the 20 DMA of $51.03. Depending on how the markets trade on Monday, the stock could possibly find support at the 50 DMA of $49.74. In the short term, there is a minor support around the $50.38 area, and a resistance around the 52.07 area.

A few ways to trade this name would be to either wait for a close above the 52.07 resistance to go long or wait for a close below the minor support at 50.38 to go short the stock. A test of the 50 DMA and a close above it might signify a buying point as well.

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The company made several acquisitions last year and in its most recent financial results released on January 26, the company topped $1 billion in quarterly sales and inches ever closer to making the Fortune 500 list.

Despite the downgrades in Europe, the dips are currently being bought, and even though we are overbought in the markets, we can remain overbought for a while. Therefore caution should be exercised when trading, and you should always hedge your position. A stop-loss should always be in place as risk management is an important part of trading. This is an analysis and not a trade recommendation.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 24 hours of this writing.

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