Kraft Heinz’s (KHC, $32.75) in deep trouble after the departure of its CEO
The iconic food company, Kraft Heinz, has been struggling to keep up with changing consumer tastes and stiff competition from new brands. The news of the exit of CEO, Bernardo Hees, only adds to its ongoing troubles by denting the company’s reputation.
Nevertheless, the company’s shares rose 1.3% on Monday following the announcement that former Anheuser-Busch InBev executive Miguel Patricio will be the new CEO.
Valued at $40.2 billion, the company’s stock fell more than 43% in the last year. Sales have stagnated coupled with increased commodity costs resulting in shortage of cost cutting.
But there's more. The company received a subpoena from the SEC earlier this year over accounting policies and internal controls. Further, it slashed its dividend by 36% taking down $15.4 billion on Kraft and Oscar Mayer, two of its biggest brands. Revenue and earnings also fell short of Wall Street estimates. Soon after, Warren Buffett, who in 2015 teamed up with Brazilian private equity firm 3G Capital to finance the merger between Kraft and Heinz, disclosed that he overpaid for Kraft. 3G, one of Kraft’s biggest shareholders, also trimmed its stake in the company by 7% bringing its total ownership to about 22%.
Because of these troubles, Kraft Heinz is contemplating a number of divestitures of some of its renowned brands like Maxwell House coffee business and Breakstone’s sour cream and cottage cheese brand.
KHC in +1.27% Uptrend, advancing for three consecutive days on October 16, 2024
Moving higher for three straight days is viewed as a bullish sign. Keep an eye on this stock for future growth. Considering data from situations where KHC advanced for three days, in of 320 cases, the price rose further within the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on October 14, 2024. You may want to consider a long position or call options on KHC as a result. In of 72 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for KHC just turned positive on October 11, 2024. Looking at past instances where KHC's MACD turned positive, the stock continued to rise in of 43 cases over the following month. The odds of a continued upward trend are .
KHC moved above its 50-day moving average on October 11, 2024 date and that indicates a change from a downward trend to an upward trend.
The 50-day moving average for KHC moved above the 200-day moving average on October 01, 2024. This could be a long-term bullish signal for the stock as the stock shifts to an upward trend.
Bearish Trend Analysis
The Stochastic Oscillator has been in the overbought zone for 2 days. Expect a price pull-back in the near future.
The 10-day moving average for KHC crossed bearishly below the 50-day moving average on October 03, 2024. This indicates that the trend has shifted lower and could be considered a sell signal. In of 15 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where KHC declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for KHC entered a downward trend on October 14, 2024. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is seriously undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.910) is normal, around the industry mean (6.502). P/E Ratio (16.043) is within average values for comparable stocks, (26.887). Projected Growth (PEG Ratio) (1.048) is also within normal values, averaging (2.471). Dividend Yield (0.043) settles around the average of (0.043) among similar stocks. P/S Ratio (1.718) is also within normal values, averaging (66.254).
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 81, placing this stock better than average.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. KHC’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
General Information
a manufacturer of packaged food products
Industry FoodSpecialtyCandy