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Kraft Heinz (KHC) Outpaces Stock Market Gains: What You Should Know

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Kraft Heinz (KHC - Free Report) closed at $48.14 in the latest trading session, marking a +0.86% move from the prior day. This move outpaced the S&P 500's daily gain of 0.47%. At the same time, the Dow added 0.68%, and the tech-heavy Nasdaq gained 0.74%.

Heading into today, shares of the maker of Oscar Mayer meats, Jell-O pudding and Velveeta cheese had gained 5.29% over the past month, lagging the Consumer Staples sector's gain of 5.78% and the S&P 500's gain of 7.71% in that time.

Wall Street will be looking for positivity from KHC as it approaches its next earnings report date. In that report, analysts expect KHC to post earnings of $0.94 per share. This would mark year-over-year growth of 4.44%. Our most recent consensus estimate is calling for quarterly revenue of $6.95 billion, up 1.11% from the year-ago period.

Investors might also notice recent changes to analyst estimates for KHC. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.44% lower. KHC is currently a Zacks Rank #4 (Sell).

Investors should also note KHC's current valuation metrics, including its Forward P/E ratio of 12.81. Its industry sports an average Forward P/E of 16.18, so we one might conclude that KHC is trading at a discount comparatively.

Also, we should mention that KHC has a PEG ratio of 2.33. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Food - Miscellaneous was holding an average PEG ratio of 2.11 at yesterday's closing price.

The Food - Miscellaneous industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 189, which puts it in the bottom 26% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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