Skip to Content

WK Kellogg Co KLG

Morningstar Rating
$17.90 +0.06 (0.34%)
View Full Chart
Unlock our analysis with Morningstar Investor

Company Report

Despite WK Kellogg's Prudent Efforts to Lift Profits, We Fail to See a Durable Competitive Edge

Even with the intended benefits enhanced focus should unlock, we fail to see an enduring competitive advantage in WK Kellogg as a stand-alone business. For one, we surmise its leading market share position in the North American cereal aisle is diluted as its entire portfolio sits in a shrinking category. In our view, this dents its relationships with retailers that strive to stock shelves with key traffic drivers. Further, without ties to the faster-growing snacks arm (which now sits inside narrow-moat Kellanova), WK Kellogg is left with subpar scale (generating less than $3 billion in sales annually), which likely weakens its bargaining power when sourcing key ingredients, negotiating slotting fees, and securing advertising placements.

Price vs Fair Value

KLG is trading at a 499% premium.
Price
$17.82
Fair Value
$66.00
Uncertainty
Medium
1-Star Price
$61.67
5-Star Price
$45.20
Economic Moat
Sjw
Capital Allocation
Qflxtjm

Bulls Say, Bears Say

Bulls

With its singular focus on cereal, we think WK Kellogg will be able to increase its investment in automating its supply chain and manufacturing footprint, which should drive efficiencies and lift margins.

Bears

We expect competitive pressures to intensify, as other leading branded operators, small startups, and lower-priced private-label fare all jockey for market share in the mature cereal aisle.

Is it the right time to buy, sell, or hold?
Start a free trial of Morningstar Investor to unlock exclusive ratings and continuous analyst coverage to help you decide if KLG is a good fit for your portfolio.

News

Trading Information

Previous Close Price
$17.84
Day Range
$17.5718.08
52-Week Range
$9.6724.62
Bid/Ask
$17.86 / $17.90
Market Cap
$1.54 Bil
Volume/Avg
263,086 / 1.0 Mil

Key Statistics

Price/Earnings (Normalized)
13.98
Price/Sales
0.56
Dividend Yield (Trailing)
2.69%
Dividend Yield (Forward)
3.59%
Total Yield
2.69%

Company Profile

WK Kellogg is the second-largest cereal manufacturer in North America. Its cereal brands include Special K, Frosted Flakes, Raisin Bran, Froot Loops, Frosted Mini Wheats, Kashi, Corn Flakes, Rice Krispies, Apple Jacks, and Bear Naked. The company was spun off from the former Kellogg business, now known as Kellanova, where the former firm’s global snacks portfolio and international cereal brands are now housed. WK Kellogg, which began trading independently in October 2023, generates the bulk of its sales (about 88% of its fiscal 2023 base) from its home turf.
Sector
Consumer Defensive
Industry
Packaged Foods
Stock Style Box
Small Value
Total Number of Employees
3,150

Competitors

Valuation

Metric
KLG
CAG
GIS
Price/Earnings (Normalized)
13.9810.5714.15
Price/Book Value
4.821.483.92
Price/Sales
0.561.121.90
Price/Cash Flow
11.107.3411.74
Price/Earnings
KLG
CAG
GIS

Financial Strength

Metric
KLG
CAG
GIS
Quick Ratio
0.400.290.33
Current Ratio
0.840.950.66
Interest Coverage
3.357.70
Quick Ratio
KLG
CAG
GIS

Profitability

Metric
KLG
CAG
GIS
Return on Assets (Normalized)
6.45%5.79%8.71%
Return on Equity (Normalized)
31.43%14.39%27.32%
Return on Invested Capital (Normalized)
14.32%8.83%13.78%
Return on Assets
KLG
CAG
GIS
See how this stock stacks up to its competitors with Morningstar Investor

Packaged Foods Industry Comparables

1-Day Chart
Name
Price
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
Nestle SA ADR
NSRGY
BvcfzflwqLqvph$279.2 Bil
Danone SA ADR
DANOY
GglkzgydSksgfr$40.6 Bil
The Kraft Heinz Co
KHC
HkcplqdMvmrn$39.3 Bil
General Mills Inc
GIS
YngfqqzfcQrmjhks$37.0 Bil
Kellanova Co
K
JbytcpxPgsyr$19.7 Bil
McCormick & Co Inc Registered Shs Non Vtg
MKC
MhqcybxnDxqy$18.2 Bil
Hormel Foods Corp
HRL
RxrbyhklNfwtmd$16.7 Bil
Conagra Brands Inc
CAG
QwqjjsysrPsnxj$13.5 Bil
Campbell Soup Co
CPB
GcskqcgFkv$13.1 Bil
Lamb Weston Holdings Inc
LW
PylmzylkKtyvwf$12.5 Bil

Sponsor Center