It's Crunch Time for Kellogg's Cereal Business
Just before the pandemic hit in 2020, Kellogg (NYSE: K) basically completed a major portfolio overhaul. It sold slower-growing brands and added faster-growing ones as it shifted toward snacking. However, it still has a sizable cereal business, which consumers know well. The only problem is that the cereal division hasn't been hitting on all cylinders.
The fact that Kellogg's portfolio revamp ended just as the coronavirus pandemic began is very important. That's because social distancing, working from home, and the closure of nonessential businesses led to a spike in buying food at grocery stores to eat at home.
In fact, 2020 was a pretty good year for most food makers. However, this was more of a windfall moment than a lingering change in consumer habits. Indeed, as 2021 got underway, sales started to pull back to more reasonable levels.
Source Fool.com
