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 +1.35% Uptrend, rising for three consecutive days on January 02, 2025
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 Stochastic Oscillator demonstrated that the ticker has stayed in the oversold zone for 1 day, which means it's wise to expect a price bounce in the near future.
KHC may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on January 06, 2025. You may want to consider selling the stock, shorting the stock, or exploring put options on KHC as a result. In of 70 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
The Moving Average Convergence Divergence Histogram (MACD) for KHC turned negative on January 07, 2025. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 43 similar instances when the indicator turned negative. In of the 43 cases the stock turned lower in the days that followed. This puts the odds of success at .
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 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 (6.547). P/E Ratio (16.043) is within average values for comparable stocks, (27.022). 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 (67.660).
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 Price Growth Rating for this company is (best 1 - 100 worst), indicating fairly steady price growth. KHC’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 82, placing this stock slightly better than average.
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.
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General Information
a manufacturer of packaged food products
Industry FoodSpecialtyCandy