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Kraft Heinz (KHC)
NASDAQ:KHC

Kraft Heinz (KHC) AI Stock Analysis

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Kraft Heinz

(NASDAQ:KHC)

Rating:74Outperform
Price Target:
$30.00
â–²(12.53%Upside)
Kraft Heinz's overall stock score is primarily driven by its solid financial performance and attractive valuation, despite technical indicators showing bearish trends. Strategic investments and a high dividend yield provide long-term potential, but near-term pressures from market challenges and operational efficiency concerns weigh on the score.
Positive Factors
Brand Investment
The commitment to high quality brand-building with increased media spending and raising R&D to match peers is seen as constructive for the business.
Strategic Transactions
The company's review of strategic alternatives could result in upside risk.
Negative Factors
Board Changes
The departure of two board members from its largest shareholder, Berkshire Hathaway, could lead to an adverse market reaction.
Profitability Challenges
Gross margins were also below expectations, impacting overall profitability.
Sales and Market Share
There is continued weakness in scanner data with sales declines and market share losses across key categories.

Kraft Heinz (KHC) vs. SPDR S&P 500 ETF (SPY)

Kraft Heinz Business Overview & Revenue Model

Company DescriptionThe Kraft Heinz Company (KHC) is a globally recognized food and beverage conglomerate, formed in 2015 through the merger of Kraft Foods Group and H.J. Heinz Company. Headquartered in Chicago, Illinois, and Pittsburgh, Pennsylvania, Kraft Heinz operates in the consumer packaged goods industry, offering a wide range of products across various categories including condiments, sauces, cheese and dairy, meals, meats, refreshment beverages, coffee, and other grocery products. The company markets its products under iconic brands such as Heinz, Kraft, Oscar Mayer, Philadelphia, and Velveeta, serving millions of consumers worldwide.
How the Company Makes MoneyKraft Heinz generates revenue primarily through the sale of its diverse portfolio of food and beverage products. The company's revenue streams are largely driven by its strategic brand management, with a focus on maintaining strong market positions across key categories such as condiments and sauces, cheese and dairy, and ready-to-eat meals. Kraft Heinz distributes its products through a combination of direct sales to retailers, including supermarkets, clubs, and convenience stores, and through foodservice channels supplying restaurants and institutions. Additionally, Kraft Heinz engages in strategic partnerships and alliances to expand its market reach and enhance product offerings, contributing to its earnings. The company also benefits from economies of scale in production and distribution, enabling cost efficiencies that support profitability.

Kraft Heinz Key Performance Indicators (KPIs)

Any
Any
Net Revenue by Geography
Net Revenue by Geography
Chart InsightsKraft Heinz's North American revenue shows stability, but the U.S. segment remains absent from recent data, indicating potential reporting changes. International markets, especially emerging ones, are gaining momentum, as noted in the earnings call. The company is focusing on brand growth and product renovations to combat inflation and tariff impacts. Despite market pressures, strategic investments in marketing and emerging markets are expected to drive future growth, although operating income may face short-term declines due to increased costs and promotional activities.
Data provided by:Main Street Data

Kraft Heinz Earnings Call Summary

Earnings Call Date:Apr 29, 2025
(Q1-2025)
|
% Change Since: -6.06%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong cash flow and strategic investments in brand growth and emerging markets, but was balanced by significant challenges including revised guidance due to market pressures, expected declines in operating income, and increased costs from inflation and tariffs.
Q1-2025 Updates
Positive Updates
Strong Cash Flow Performance
Despite growing market pressure, The Kraft Heinz Company delivered strong cash flow performance and maintained a healthy balance sheet in the first quarter of 2025.
Investments in Brand Growth System
The company is scaling up its brand growth system to 40% of its business by the end of the year, a significant increase from the 10% in 2024. This system aims to drive brand superiority and growth.
Emerging Markets Acceleration
The company expects further acceleration in emerging markets beyond the first quarter.
Innovations and Renovations
The company is focused on renovating products and improving product quality, such as in the Philadelphia cream cheese and Capri Sun lines, which are expected to drive growth.
Double-Digit Growth in Mexican Strategy
The Kraft Heinz Company saw double-digit growth in its Mexican strategy last year and continues to see similar growth this year.
Negative Updates
Revised Revenue Guidance and Market Tension
The company has adjusted its guidance due to market tension and a challenging macroeconomic environment, leading to a larger-than-expected cut in guidance.
Decline in Operating Income
Operating income is expected to decline double digits in the second quarter due to increased promotional activity, hedge losses, and commodity cost pressures.
COGS Inflation Impact
The company revised its COGS inflation outlook from 3% to 5%, with additional impacts expected from tariffs leading to potentially 50 to 200 bps increase in COGS.
Pressure on Gross Margins
Increased promotional activity, commodity costs, and hedge losses are expected to pressure gross margins in the second quarter.
Promotional Activity Still Below 2019 Levels
The Kraft Heinz Company's promotional activity volume is still below 2019 levels, contrasting with other large food companies.
Company Guidance
During the Kraft Heinz Company's first quarter 2025 earnings call, the company provided revised guidance reflecting ongoing market challenges and strategic investments. The company highlighted its commitment to playing offense with discipline, prioritizing investments in marketing, R&D, and technology, with a focus on enhancing returns on marketing dollars and optimizing brand and media strategies. The guidance included a step-up in marketing expenses to approximately 4.8% of revenue, nearing the company's long-term target of 5%, and an anticipated inflation rate of 5% in COGS, influenced by rising costs in commodities like coffee and meat. Tariff impacts were estimated to add 50 to 200 basis points to COGS, primarily in the second half of the year. Despite these pressures, the company maintained its pricing outlook, indicating no further price investments beyond the previously planned 100 basis points. Furthermore, the company's operating income was expected to decline double digits in Q2, driven by increased promotional activity, hedge losses, and product renovations. The guidance was adjusted to provide flexibility amidst a dynamic policy landscape, allowing the company to continue investing in key growth initiatives.

Kraft Heinz Financial Statement Overview

Summary
Kraft Heinz demonstrates a stable financial position with average operational efficiency and moderate profitability. The balance sheet is strong with low leverage and solid equity, while cash flows are well-managed despite recent declines in free cash flow growth. The company might need to focus on reigniting revenue growth to enhance future profitability and shareholder value.
Income Statement
67
Positive
Kraft Heinz shows moderate stability in its income statement. The TTM gross profit margin is approximately 34.5%, indicating efficient cost management. However, the net profit margin of 10.4% is somewhat lower, reflecting potential challenges in converting revenue to profit. Revenue has shown a slight decline in recent years, indicating stagnation in growth. The EBIT margin is at 6.2%, and EBITDA margin stands at 9.5%, both suggesting average operational efficiency.
Balance Sheet
72
Positive
The company maintains a solid balance sheet with a debt-to-equity ratio of 0.42, indicating conservative leverage. Return on equity (ROE) is at 5.4%, hinting at moderate profitability for shareholders. The equity ratio is 54.8%, which demonstrates a strong equity position relative to total assets, providing stability and resilience against liabilities.
Cash Flow
70
Positive
Cash flow analysis reveals adequate liquidity management. The free cash flow to net income ratio is 1.14, indicating good cash generation relative to net income. The operating cash flow to net income ratio is 1.56, suggesting robust cash conversion efficiency. However, the free cash flow growth rate shows a negative trend, down by 4.3%, which may limit future investment capabilities.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue25.43B25.85B26.64B26.48B26.04B26.18B
Gross Profit8.79B8.97B8.93B8.12B8.68B9.18B
EBITDA2.71B2.72B5.51B4.82B4.67B3.39B
Net Income2.65B2.74B2.85B2.36B1.01B356.00M
Balance Sheet
Total Assets103.56B88.29B90.34B90.51B93.39B99.83B
Cash, Cash Equivalents and Short-Term Investments1.10B1.33B1.40B1.04B3.44B3.42B
Total Debt31.11B19.87B20.03B20.07B21.82B28.31B
Total Liabilities51.73B38.96B40.62B41.64B43.94B49.59B
Stockholders Equity51.70B49.19B49.53B48.68B49.30B50.10B
Cash Flow
Free Cash Flow3.02B3.16B2.96B1.55B4.46B4.33B
Operating Cash Flow4.13B4.18B3.98B2.47B5.36B4.93B
Investing Cash Flow-1.61B-1.02B-916.00M-1.09B4.04B-522.00M
Financing Cash Flow-1.87B-3.01B-2.68B-3.71B-9.34B-3.33B

Kraft Heinz Technical Analysis

Technical Analysis Sentiment
Negative
Last Price26.66
Price Trends
50DMA
26.90
Negative
100DMA
28.20
Negative
200DMA
29.60
Negative
Market Momentum
MACD
-0.15
Negative
RSI
45.75
Neutral
STOCH
68.40
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KHC, the sentiment is Negative. The current price of 26.66 is above the 20-day moving average (MA) of 26.15, below the 50-day MA of 26.90, and below the 200-day MA of 29.60, indicating a bearish trend. The MACD of -0.15 indicates Negative momentum. The RSI at 45.75 is Neutral, neither overbought nor oversold. The STOCH value of 68.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KHC.

Kraft Heinz Risk Analysis

Kraft Heinz disclosed 34 risk factors in its most recent earnings report. Kraft Heinz reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Kraft Heinz Peers Comparison

Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
KHKHC
74
Outperform
$31.55B12.095.36%6.00%-4.25%-4.04%
68
Neutral
S$3.41B16.78-11.82%6.53%5.14%-8.01%
CACAG
67
Neutral
$10.02B30.713.67%6.67%-3.15%-65.38%
HRHRL
64
Neutral
$16.76B22.419.39%3.81%-1.01%-2.93%
HRHRL
64
Neutral
$16.76B22.419.39%3.81%-1.01%-2.93%
GIGIS
63
Neutral
$28.83B12.9724.57%4.51%-1.87%-5.16%
GIGIS
63
Neutral
$28.83B12.9724.57%4.51%-1.87%-5.16%
CPCPB
53
Neutral
$9.32B20.6511.67%4.99%8.65%-38.57%
CPCPB
53
Neutral
$9.32B20.6511.67%4.99%8.65%-38.57%
SJSJM
47
Neutral
$11.04B22.22-17.87%4.15%6.69%-261.87%
SJSJM
47
Neutral
$11.04B22.22-17.87%4.15%6.69%-261.87%
* Consumer Defensive Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
KHC
Kraft Heinz
26.08
-4.40
-14.44%
CPB
Campbell Soup
30.81
-12.47
-28.81%
CPB
Campbell Soup
30.81
-12.47
-28.81%
CAG
Conagra Brands
20.41
-6.56
-24.32%
GIS
General Mills
53.15
-7.00
-11.64%
GIS
General Mills
53.15
-7.00
-11.64%
HRL
Hormel Foods
30.47
1.43
4.92%
HRL
Hormel Foods
30.47
1.43
4.92%
SJM
JM Smucker
104.08
-1.58
-1.50%
SJM
JM Smucker
104.08
-1.58
-1.50%

Kraft Heinz Corporate Events

Executive/Board Changes
Kraft Heinz Announces Leadership Transition in Finance
Neutral
Jun 17, 2025

On June 12, 2025, Kraft Heinz announced that Vince Garlati, Vice President, Global Controller and Principal Accounting Officer, will step down from his role effective June 22, 2025, transitioning to Vice President of Corporate Strategic Projects. Chris Asher, currently the Deputy Global Controller, will succeed him, bringing extensive experience from various roles within the company since 2018. The Human Capital and Compensation Committee has approved Asher’s new compensation package, including a base salary of $400,000 and a performance bonus target of 120% of his salary, alongside future equity awards starting in 2026.

The most recent analyst rating on (KHC) stock is a Hold with a $34.00 price target. To see the full list of analyst forecasts on Kraft Heinz stock, see the KHC Stock Forecast page.

Executive/Board Changes
Kraft Heinz Board Members Step Down
Neutral
May 20, 2025

On May 19, 2025, Kraft Heinz announced that Board members Timothy Kenesey and Alicia Knapp decided to step down, effective May 20, 2025, without any disagreements with the company’s management or policies. As a result, the Board’s size has been reduced to ten members, which may impact the company’s governance structure.

The most recent analyst rating on (KHC) stock is a Hold with a $34.00 price target. To see the full list of analyst forecasts on Kraft Heinz stock, see the KHC Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Kraft Heinz Elects Directors at Annual Meeting
Neutral
May 13, 2025

On May 8, 2025, Kraft Heinz held its Annual Meeting of Stockholders where all 12 director nominees were elected for a one-year term. Additionally, stockholders approved the executive compensation and the selection of PricewaterhouseCoopers LLP as independent auditors for 2025. However, proposals regarding recyclability claims, plastic packaging, and adopting a policy for an independent Board Chair were not approved.

The most recent analyst rating on (KHC) stock is a Hold with a $34.00 price target. To see the full list of analyst forecasts on Kraft Heinz stock, see the KHC Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 03, 2025