WBAG:KHC

Stock Analysis Report

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Executive Summary

The Kraft Heinz Company, together with its subsidiaries, manufactures and markets food and beverage products in the United States, Canada, the United Kingdom, and internationally.


Snowflake Analysis

Fair value with mediocre balance sheet.


Similar Companies

Share Price & News

How has Kraft Heinz's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: KHC's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

1.5%

KHC

1.5%

AT Food

4.5%

AT Market


1 Year Return

7.8%

KHC

-0.1%

AT Food

-15.6%

AT Market

Return vs Industry: KHC exceeded the Austrian Food industry which returned -0.3% over the past year.

Return vs Market: KHC exceeded the Austrian Market which returned -16.4% over the past year.


Shareholder returns

KHCIndustryMarket
7 Day1.5%1.5%4.5%
30 Day1.3%2.9%6.6%
90 Day19.2%-1.8%-6.5%
1 Year14.2%7.8%2.0%-0.1%-14.7%-15.6%
3 Year-61.6%-66.7%17.8%11.0%-11.8%-18.6%
5 Yearn/a46.6%33.1%18.8%3.8%

Price Volatility Vs. Market

How volatile is Kraft Heinz's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Kraft Heinz undervalued compared to its fair value and its price relative to the market?

32.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: KHC (€27.38) is trading below our estimate of fair value (€40.34)

Significantly Below Fair Value: KHC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: KHC is poor value based on its PE Ratio (20.2x) compared to the Food industry average (18x).

PE vs Market: KHC is poor value based on its PE Ratio (20.2x) compared to the Austrian market (10.8x).


Price to Earnings Growth Ratio

PEG Ratio: KHC is poor value based on its PEG Ratio (2x)


Price to Book Ratio

PB vs Industry: KHC is good value based on its PB Ratio (0.8x) compared to the XE Food industry average (1.1x).


Next Steps

Future Growth

How is Kraft Heinz forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

9.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: KHC's forecast earnings growth (9.9% per year) is above the savings rate (0.5%).

Earnings vs Market: KHC's earnings (9.9% per year) are forecast to grow slower than the Austrian market (22.7% per year).

High Growth Earnings: KHC's earnings are forecast to grow, but not significantly.

Revenue vs Market: KHC's revenue is expected to decline over the next 3 years (-0.04% per year).

High Growth Revenue: KHC's revenue is forecast to decline over the next 3 years (-0.04% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: KHC's Return on Equity is forecast to be low in 3 years time (5.5%).


Next Steps

Past Performance

How has Kraft Heinz performed over the past 5 years?

-17.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: KHC has a large one-off loss of $1.4B impacting its March 28 2020 financial results.

Growing Profit Margin: KHC became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: KHC's earnings have declined by -17% per year over the past 5 years.

Accelerating Growth: KHC has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: KHC has become profitable in the last year, making it difficult to compare its past year earnings growth to the Food industry (-0.9%).


Return on Equity

High ROE: KHC's Return on Equity (3.7%) is considered low.


Next Steps

Financial Health

How is Kraft Heinz's financial position?


Financial Position Analysis

Short Term Liabilities: KHC's short term assets ($11.7B) exceed its short term liabilities ($7.9B).

Long Term Liabilities: KHC's short term assets ($11.7B) do not cover its long term liabilities ($45.0B).


Debt to Equity History and Analysis

Debt Level: KHC's debt to equity ratio (62.6%) is considered high.

Reducing Debt: KHC's debt to equity ratio has reduced from 89.4% to 62.6% over the past 5 years.

Debt Coverage: KHC's debt is not well covered by operating cash flow (10.8%).

Interest Coverage: KHC's interest payments on its debt are well covered by EBIT (4x coverage).


Balance Sheet


Next Steps

Dividend

What is Kraft Heinz's current dividend yield, its reliability and sustainability?

5.08%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: KHC's dividend (5.08%) is higher than the bottom 25% of dividend payers in the Austrian market (1.68%).

High Dividend: KHC's dividend (5.08%) is in the top 25% of dividend payers in the Austrian market (5.01%)


Stability and Growth of Payments

Stable Dividend: KHC has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: KHC has only been paying a dividend for 5 years, and since then payments have fallen.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (102.4%), KHC's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: KHC's dividends in 3 years are forecast to be covered by earnings (67.7% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.0yrs

Average management tenure


CEO

Miguel Patricio (53yo)

1

Tenure

US$43,297,480

Compensation

Mr. Miguel Patricio has been the Chief Executive Officer of The Kraft Heinz Company since June 25, 2019 and served as its Interim President of U.S. Zone from July 1, 2019 to February 2020. Mr. Patricio ser ...


CEO Compensation Analysis

Compensation vs Market: Miguel's total compensation ($USD43.30M) is above average for companies of similar size in the Austrian market ($USD3.79M).

Compensation vs Earnings: Insufficient data to compare Miguel's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Miguel Patricio
Chief Executive Officer1yrUS$43.30m0.065% $22.0m
Paulo Luiz Basilio
Global Chief Financial Officer0.75yrUS$15.37m0.053% $18.0m
Rashida La Lande
Senior VP2.42yrsUS$7.38mno data
Nina Barton
Chief Growth Officer4.92yrsUS$8.49m0.0021% $726.9k
Rafael de Oliveira
Zone President of International3.67yrsUS$11.09m0.0020% $679.3k
Flavio Torres
Head of Global Operations0.42yrno datano data
Vince Garlati
VP, Principal Accounting Officer & Global Controller2yrsno data0.00053% $180.0k
Christopher Jakubik
Head of Global Investor Relationsno datano datano data
Peter Hall
Vice President of Salesno datano datano data
Melissa Werneck
Global Chief People Officerno datano datano data

2.0yrs

Average Tenure

45yo

Average Age

Experienced Management: KHC's management team is considered experienced (2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
John Cahill
Vice Chairman4.92yrsUS$496.43k0.012% $4.1m
John Pope
Independent Director4.92yrsUS$255.00k0.00083% $281.9k
Jorge Paulo Alberto Lemann
Independent Director7.42yrsUS$235.03k0.29% $97.2m
Gregory Abel
Independent Director7yrsUS$235.03k0.0032% $1.1m
Alexandre Behring
Independent Chairman7yrsUS$388.99k0.0034% $1.1m
Alexandre Van Damme
Independent Director2.17yrsUS$235.03k0.00049% $166.4k
Timothy Kenesey
Independent Director0.42yrno data0.00052% $176.6k
Elio Sceti
Independent Director0.083yrno data0.00035% $118.9k
George El-Zoghbi
Director2.17yrsUS$180.00k0.0070% $2.4m
Joao Castro-Neves
Independent Director1yrUS$152.32kno data

3.5yrs

Average Tenure

55yo

Average Age

Experienced Board: KHC's board of directors are considered experienced (3.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

The Kraft Heinz Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Kraft Heinz Company
  • Ticker: KHC
  • Exchange: WBAG
  • Founded: 1869
  • Industry: Packaged Foods and Meats
  • Sector: Food, Beverage & Tobacco
  • Market Cap: US$38.476b
  • Listing Market Cap: US$33.966b
  • Shares outstanding: 1.22b
  • Website: https://www.kraftheinzcompany.com

Number of Employees


Location

  • The Kraft Heinz Company
  • One PPG Place
  • Pittsburgh
  • Pennsylvania
  • 15222
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
KHCNasdaqGS (Nasdaq Global Select)YesNew Common StockUSUSDJul 2015
KHNZXTRA (XETRA Trading Platform)YesNew Common StockDEEURJul 2015
KHC *BMV (Bolsa Mexicana de Valores)YesNew Common StockMXMXNJul 2015
KHNZDB (Deutsche Boerse AG)YesNew Common StockDEEURJul 2015
KHC-UETLX (Eurotlx)YesNew Common StockITEURJul 2015
KHCSWX (SIX Swiss Exchange)YesNew Common StockCHCHFJul 2015
KHCWBAG (Wiener Boerse AG)YesNew Common StockATEURJul 2015
0JRVLSE (London Stock Exchange)YesNew Common StockGBUSDJul 2015
KHCB34BOVESPA (Bolsa de Valores de Sao Paulo)EACH BDR REPR 1 COM USD0.01BRBRLSep 2015

Biography

The Kraft Heinz Company, together with its subsidiaries, manufactures and markets food and beverage products in the United States, Canada, the United Kingdom, and internationally. Its products include condiments and sauces, cheese and dairy, meals, meats and seafood, frozen and chilled foods, packaged drinking pouches, appetizers, refreshment beverages, coffee, nuts and salted snacks, infant and nutrition products, and other grocery products, as well as desserts, dressings, toppings, and baking. The company offers its products under the Kraft, Oscar Mayer, Heinz, Philadelphia, Lunchables, Velveeta, Planters, Maxwell House, Capri Sun, Ore-Ida, Kool-Aid, Jell-O, Classico, McCafe, Tassimo, TGI Fridays, Taco Bell Home Originals, Plasmon, Pudliszki, Honig, HP, Benedicta, Karvan Cevitam, ABC, Master, Quero, Golden Circle, and Wattie's names. It sells its products through its own sales organizations, as well as through independent brokers, agents, and distributors to chain, wholesale, cooperative and independent grocery accounts, convenience stores, drug stores, value stores, bakeries, pharmacies, mass merchants, club stores, foodservice distributors and institutions, including hotels, restaurants, hospitals, health care facilities, and government agencies; and online through e-commerce platforms and retailers. The company was formerly known as H.J. Heinz Holding Corporation and changed its name to The Kraft Heinz Company in July 2015. The Kraft Heinz Company was founded in 1869 and is headquartered in Pittsburgh, Pennsylvania. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/05 01:00
End of Day Share Price2020/06/04 00:00
Earnings2020/03/28
Annual Earnings2019/12/28


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.