International Flavors & Fragrances, Inc.’s (IFF - Free Report) subsidiary, IFF-Lucas Meyer Cosmetics (IFF-LMC) has acquired three personal care ingredients and related intellectual properties from Kemin Industries to expand its product portfolio. Financial terms of the deal were not disclosed.
Headquartered in Des Moines, IA, Kemin Industries is an ingredient manufacturer committed to improving the quality, safety and efficacy of feed, food and health-related products. The company operates in 90 countries with more than 2,500 employees worldwide.
IFF-LMC develops, manufactures and markets innovative ingredients for the cosmetic and personal care industry. Per the transaction, IFF-LMC bought three products of Kemin, comprising Lysofix, XFoliPEARL and MicroCurb. This acquisition expands IFF-LMC's product portfolio and related offerings to its customers, particularly to those focused on the environment and sustainability.
Notably, the acquisition will drive results of the International Flavors’ Fragrances segment, which contributed around 51% of net revenues in third-quarter 2018. This segment markets its products primarily to the cosmetics industry, which includes perfume and toiletry manufacturers.
Thus, the buyout is in sync with International Flavors’ commitment to sustainability and natural product offerings. Its latest acquisition of Frutarom — an Israeli company that develops, produces and markets flavors and fragrances — will also drive International Flavors’ cosmetic business. Frutarom is expected to be accretive to International Flavors’ fourth-quarter 2018 top and bottom-line results.
Moreover, International Flavors will gain on cost-cutting efforts, productivity initiatives and growth in global market for flavors and fragrances, despite input cost inflation, disruptions in the supply chain and huge debt levels.
Share Price Performance
Shares of the company have outperformed the industry over the past six months. The stock has gained around 10%, against the 3% decline recorded by the industry during the same period.
Zacks Rank & Stocks to Consider
Currently, International Flavors carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same sector are The Mosaic Company (MOS - Free Report) , Verso Corporation (VRS - Free Report) and Cleveland-Cliffs Inc. (CLF - Free Report) . While Mosaic currently sports a Zacks Rank #1 (Strong Buy), Verso and Cleveland-Cliffs carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Over the past 60 days, Mosaic has witnessed upward earnings estimate revisions of 10% for 2018. The company’s shares have rallied around 21% over the past six months.
Over the past 60 days, Verso has witnessed upward earnings estimate revisions of 14% for 2018. The stock has gained around 18% over the past six months.
Over the past 60 days, Cleveland-Cliffs has witnessed upward earnings estimate revisions of 38% for 2018. Its shares have gained 6% over the past six months.
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