Do You Believe in the Upside Potential of International Flavors & Fragrances (IFF)?

Investment management company First Pacific Advisors recently released its “The FPA Crescent Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the third quarter, the fund gained 5.54% and 15.32% in the trailing twelve months. The fund’s top five performers contributed 6. 65% to its trailing twelve-month return while its bottom five detracted 2.58%. In addition, you can check the top 5 holdings of the fund to know its best picks in 2025.

In its third-quarter 2025 investor letter, The FPA Crescent Fund highlighted stocks such as International Flavors & Fragrances Inc. (NYSE:IFF). International Flavors & Fragrances Inc. (NYSE:IFF) is a manufacturer of food, beverage, health and biosciences, scent, pharma solutions, and complementary adjacent products. The one-month return of International Flavors & Fragrances Inc. (NYSE:IFF) was 6.40%, and its shares lost 29.64% of their value over the last 52 weeks. On November 5, 2025, International Flavors & Fragrances Inc. (NYSE:IFF) stock closed at $64.00 per share, with a market capitalization of $16.39 billion.

The FPA Crescent Fund stated the following regarding International Flavors & Fragrances Inc. (NYSE:IFF) in its third quarter 2025 investor letter:

“International Flavors & Fragrances Inc. (NYSE:IFF) is a leading producer of ingredients for food, beverage, personal care, health, and household products industries. Its products are ubiquitous across many household staples, including the enzyme used in half of cold-water laundry detergents, another enzyme used in one-fifth of the global beer market, and one-third of yogurts use an IFF culture. IFF has faced challenges: its prior management was unfortunately reckless in capital allocation, making poor acquisitions and failing to manage its diverse global enterprise effectively. This transformed a high-margin, unlevered company into one with a lower margin and greater leverage. However, a new CEO has renewed the company’s focus on being best-in-class operationally, with a smaller suite of products. IFF has sold and is expected to continue to sell non-core assets, which would decrease the firm’s leverage and likely improving margins. The company has burned investors, leading many to adopt a wait-and-see attitude. IFF’s current ~$4 of free cash flow could increase to $5-6 in a few years, and if successful, its P/E ratio should also rise to be more in line with its peers. With its stock currently at $61, we don’t see much downside and, should IFF execute well, we can reasonably see a path to the stock price doubling over the next few years (inclusive of its free cash flow).”

Materials Dividends Spotlight: International Flavors & Fragrances’ (IFF) Consistent Payouts

International Flavors & Fragrances Inc. (NYSE:IFF) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 45 hedge fund portfolios held International Flavors & Fragrances Inc. (NYSE:IFF) at the end of the second quarter, compared to 47 in the previous quarter. While we acknowledge the risk and potential of International Flavors & Fragrances Inc. (NYSE:IFF) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than International Flavors & Fragrances Inc. (NYSE:IFF) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered International Flavors & Fragrances Inc. (NYSE:IFF) and shared the list of stocks Jim Cramer discussed recently. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.