Mondelēz Positioned for Long-Term Growth Amid Cocoa Price Normalization

Mondelēz International (MDLZ) is currently navigating a complex transition as global cocoa prices retreat from the historic highs seen in 2024 and 2025. Despite the downward trend in spot prices, the company's hedging strategy—locking in costs roughly a year in advance—means the full financial benefit of cheaper raw materials will not materialize until 2027. This disconnect has created a temporary earnings gap, with unprecedented cocoa inflation potentially reducing adjusted EPS by as much as 15%. Consequently, the stock has faced pressure, sliding from highs above $70 to a 52-week low of approximately $51, currently trading around $59 with a trailing dividend yield of 3.3%. The company maintains a dominant global footprint, controlling 17% of the $128 billion biscuit market and 12.4% of the $147 billion chocolate market. Its Oreo brand specifically holds an 18% share of the Chinese biscuit market, highlighting the company's strength in key regions. Emerging markets are the primary engine for long-term expansion, accounting for 40% of 2025 revenues. Sales in these regions have grown at a compound annual rate of 13.4% over the last five years, with China, Brazil, and India each contributing between $1.7 billion and $2 billion in annual revenue. CEO Dirk Van de Put has indicated that the company is already seeing marginal benefits from lower cocoa costs and plans to ramp up advertising and brand investments throughout 2026. Combined with consistent share repurchases and dividend growth, the company is positioning itself for a recovery as commodity pressures ease.