Mondelez International, Inc. (MDLZ): A Bull Case Theory

We came across a bullish thesis on Mondelez International, Inc. on Bullseye Picks’s Substack by Bullseye Investing. In this article, we will summarize the bulls’ thesis on MDLZ. Mondelez International, Inc.'s share was trading at $57.57 as of November 28th. MDLZ’s trailing and forward P/E were 21.56 and 18.28 respectively according to Yahoo Finance.

Mondelez International (NASDAQ: MDLZ), owner of iconic brands such as Oreo, Cadbury, Trident, and Sour Patch Kids, has recently faced share-price pressure despite strong Q3 results. Rising cocoa prices and elevated transportation costs have compressed margins, while weakness in American consumer purchasing power has tempered near-term demand.

However, Mondelez’s broad portfolio, global scale, and category leadership position the company for resilient long-term performance. Its biscuit and chocolate segments remain dominant, with Oreo and Cadbury driving brand loyalty, while emerging markets and premium snack offerings provide additional growth avenues. Strategic initiatives, including investments in core brands, bolt-on acquisitions, supply chain efficiencies, e-commerce expansion, and sustainability programs such as Cocoa Life, further support its operational strength.

Financially, Mondelez delivered modest revenue growth of 5.86% year-over-year, surpassing inflation, though earnings fell by over 18% due to margin pressures. Operating margins declined from 12.5% to 7.6%, and ROIC currently trails WACC at 6.2% versus 6.67%, indicating limited value creation in the near term. Analysts see potential upside as cocoa prices stabilize, with a base-case one-year price target of $62, representing roughly 11% upside from the current $56.08 share price. Even amid short-term headwinds, Mondelez’s defensive portfolio, scale advantages, and international diversification provide stable cash flow and brand resilience.

While risks remain from cocoa volatility, logistics costs, and regulatory scrutiny around sustainability, the company’s focus on emerging markets, premium products, and strategic brand investment positions it to weather macroeconomic pressures. For value-oriented investors, Mondelez presents a conservative opportunity with moderate upside, where near-term market overreactions may mask the company’s long-term fundamentals and global snack leadership.

Previously we covered a bullish thesis on Mondelez International, Inc. (MDLZ) by Daan Rijnberk in November 2024, which highlighted the company’s strong brand portfolio, leading positions in chocolate and biscuits, and resilient revenue growth despite cocoa price inflation. The company's stock price has depreciated approximately by 11.14% since our coverage. The thesis still stands as Mondelez’s scale and brand loyalty support long-term stability. Bullseye Investing shares a similar outlook but emphasizes short-term pressures from rising cocoa and transportation costs.

Mondelez International, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 49 hedge fund portfolios held MDLZ at the end of the second quarter which was 52 in the previous quarter. While we acknowledge the potential of MDLZ as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.