Scenario (figures as of 2025-11-11):
- 2% yearly Revenue Growth, a conservative target.
- 8% Margin (a signifcant improvement from the current -17.35%, and slightly over the Food average of 7.34%), an aggresive but achievable improvement.
- 5% Risk Discount Rate (same as current).
Headwinds:
- Cuts to SNAP Federal Benefits.
- Inflation affecting consumer purchasing power and more expensive input costs.
Potential Pro:
- Plans to divest part of the company, potentially unlocking intrinsic hidden value (see the example of GE's trayectory of languishing for many years, then splitting the company and unlocking more value for the parts than the aggregate.)
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Disclaimer
The user Kafka has a position in NasdaqGS:KHC. Simply Wall St has no position in any of the companies mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The author of this narrative is not affiliated with, nor authorised by Simply Wall St as a sub-authorised representative. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimates are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.
