Is Kraft Heinz Stock Underperforming the Dow?
Valued at a market cap of $37.2 billion, Pittsburgh, Pennsylvania-based The Kraft Heinz Company (KHC) is a leading global food and beverage manufacturer. It produces and markets a wide range of products under well-known brands such as Kraft, Heinz, Oscar Mayer, Philadelphia, Velveeta, and Maxwell House.
Companies valued at $10 billion or more are generally classified as “large-cap” stocks, and Kraft Heinz fits this criterion perfectly. Kraft Heinz sells its products through various channels, including grocery stores, wholesale distributors, foodservice providers, and e-commerce platforms.
Shares of the processed food company are trading 22.2% below its 52-week high of $38.96. KHC has declined nearly 4% over the past three months, a less severe decline than the broader Dow Jones Industrials Average’s ($DOWI) 5.8% dip over the same time frame.
In the longer term, KHC stock is down 1.3% on a YTD basis, which is less pronounced compared to DOWI’s 2.8% decrease. However, shares of Kraft Heinz have decreased 12.4% over the past 52 weeks, lagging behind DOWI’s 6% return over the same time frame.
Despite recent fluctuations, KHC has been trading below its 50-day and 200-day moving averages since late October last year.
Shares of Kraft Heinz fell 3.3% on Feb. 12 after reporting mixed Q4 results. While the company posted a better-than-expected adjusted EPS of $0.84, revenue came in at $6.6 billion, falling short of the estimate and marking a 4.1% year-over-year decline. A significant $40 million operating income loss, largely due to a non-cash impairment charge on the Oscar Mayer brand. Additionally, weak fiscal 2025 guidance, projecting organic net sales to decline up to 2.5% and lower-than-anticipated full-year EPS between $2.63 and $2.74, dampened investor confidence.
Kraft Heinz has lagged behind its rival, General Mills, Inc. (GIS), which has recorded an 8.7% dip over the past 52 weeks. Nevertheless, General Mills has dropped 5.9% on a YTD basis, a steeper decline than KHC.
Due to KHC’s weak performance, analysts remain cautious about its prospects. The stock has a consensus rating of “Hold” from the 18 analysts covering the stock, and as of writing, the stock is trading slightly below the mean price target of $30.67.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.