Street Calls of the Week
Kraft Heinz Co. (KHC) shares have stumbled to a 52-week low, trading at $30.25, as the food and beverage giant grapples with a challenging market environment. The company, which maintains a notable 5.12% dividend yield, continues to generate substantial revenue of $26.1 billion over the last twelve months. According to InvestingPro analysis, the stock appears undervalued at current levels. This latest price point reflects a significant retreat from previous levels, marking a stark contrast to the company's performance over the past year. Investors have witnessed a 1-year change in the stock's value, with Kraft Foods Inc (NASDAQ:KHC). experiencing a decline of -15.89%. Despite these challenges, InvestingPro data shows the company maintains profitability with a gross margin of 34.65% and positive free cash flow of $3.1 billion. This downturn highlights the pressures faced by the consumer goods sector, including shifting consumer preferences and competitive dynamics, which have impacted the company's stock trajectory and investor sentiment. For deeper insights into KHC's valuation and future prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro.
In other recent news, Kraft Heinz experienced a series of significant developments. The company reported a 2.8% drop in net sales to $6.38 billion, leading to an adjustment in its 2024 earnings per share forecast, now expected to be at the lower end of the previously stated $3.01 to $3.07 range. Analyst firms Piper Sandler and Deutsche Bank (ETR:DBKGn) downgraded Kraft Heinz's stock from Overweight and Buy to Neutral and Hold respectively, due to slower retail improvement and sluggish growth.
Goldman Sachs also maintained a Sell rating, reducing its price target for Kraft Heinz to $32.00, while TD Cowen kept a Hold rating and adjusted its price target to $34.00. On the board, Kraft Heinz welcomed Debby Soo, CEO of OpenTable, Inc., effective October 24, 2024. The company returned over $1.5 billion to shareholders through dividends and share repurchases, and extended the maturity date of its $4.0 billion revolving credit facility to July 8, 2029. Lastly, Rashida La Lande, Executive Vice President and Chief Legal and Corporate Affairs Officer, announced her immediate departure from Kraft Heinz.
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