Why Is Mondelez (MDLZ) Down 1.2% Since Last Earnings Report?

Core Viewpoint - Mondelez International's fourth-quarter 2025 results showed revenue and adjusted earnings per share exceeding estimates, despite challenges from rising cocoa costs [2][3]. Financial Performance - Adjusted earnings per share reached 72 cents, a 4.6% increase on a constant-currency basis, surpassing the Zacks Consensus Estimate of 70 cents [2]. - Net revenues rose 9.3% year over year to $10.5 billion, exceeding the Zacks Consensus Estimate of $10.3 billion, driven by organic growth, favorable foreign-currency impacts, and contributions from the Evirth acquisition [3]. - Organic net revenues grew 5.1% year over year, primarily due to pricing, which contributed 9.9 percentage points, while volume/mix declined by 4.8 percentage points [4]. Regional Performance - Revenues from emerging markets increased 13.2% year over year to $4.1 billion, with organic growth of 8%, supported by strong pricing execution [5]. - Developed markets saw revenues rise 6.9% year over year to $6.4 billion, with organic growth of 3.4%, although volume/mix declines in North America impacted results [5][6]. Profitability Metrics - Adjusted gross profit increased modestly, but the adjusted gross margin declined 100 basis points to 30.5%, primarily due to elevated raw material costs [7]. - Adjusted operating income surged 22.1% at constant currency, with the adjusted operating income margin improving 190 basis points to 11.9% [8]. Financial Health - Mondelez ended the quarter with cash and cash equivalents of $2.1 billion and total debt of $21.2 billion, generating $4.5 billion in net cash from operating activities for the full year 2025 [9]. - The company returned $4.9 billion to shareholders through dividends and share buybacks during 2025, indicating a commitment to disciplined capital allocation [9]. Future Outlook - For 2026, Mondelez expects organic net revenue growth to range between flat and 2%, with adjusted earnings per share projected to grow between flat and 5% on a constant-currency basis [10][11]. - The company anticipates currency translation to boost 2026 net revenue growth by about 2% and lift adjusted EPS by roughly 6 cents [11]. Market Sentiment - There has been a downward trend in estimates, with the consensus estimate shifting down by 15.36% recently [12]. - Mondelez currently holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return from the stock in the coming months [14].