Skip to Content
US Videos

Our Confidence in Undervalued General Mills Is Growing

We upgraded the firm's economic moat rating to wide from narrow due to the durability of its brand and favorable cost structure.

Mentioned:

Sonia Vora: We recently upgraded our economic moat rating for General Mills to wide from narrow to reflect our greater confidence in the durability of its brand-intangible assets and favorable cost structure. 

The firm's portfolio includes several well-known brands, like Cheerios and Yoplait, which have bolstered its relationships with retailers that depend on leading brands to drive store traffic and inventory turnover. While these categories remain competitive, we believe retailers' aversion to out-of-stocks has benefited established manufacturers. We think these relationships have helped General Mills to maintain valuable shelf space for its offerings, even in areas like yogurt, where its share has been challenged. We also think General Mills has shown modest pricing power, as price and mix have averaged more than a 2% contribution to sales over the past decade, driving nearly 60% of organic growth. From our vantage point, this further suggests evidence of a brand-intangible asset.

Sonia Vora does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.

Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.

We’d like to share more about how we work and what drives our day-to-day business.

We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.

How we use your information depends on the product and service that you use and your relationship with us. We may use it to:

  • Verify your identity, personalize the content you receive, or create and administer your account.
  • Provide specific products and services to you, such as portfolio management or data aggregation.
  • Develop and improve features of our offerings.
  • Gear advertisements and other marketing efforts towards your interests.

To learn more about how we handle and protect your data, visit our privacy center.

Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

Read our editorial policy to learn more about our process.