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Reasons Why Kraft Heinz (KHC) Should be in Your Portfolio
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The Kraft Heinz Company (KHC - Free Report) is well-poised for growth, courtesy of strength across its end markets, effective pricing actions, acquired assets and strategic partnerships. The company is focused on investing in growth opportunities, solidifying its long-term market position and staying committed to shareholder returns.
Image Source: Zacks Investment Research
This Zacks Rank #2 (Buy) company has a market capitalization of $45.6 billion. Over the past year, it has gained 1.2% compared with the industry’s growth of 11.9%.
Let’s delve into the factors that have been aiding this manufacturer of food and beverage products for a while now.
Business Strength: Kraft Heinz has been benefiting from strength across its foodservice, retail and emerging markets. The company’s robust pricing actions are likely to continue working well amid cost inflation. In the first quarter of 2023, the company generated net sales of $6,489 million, reflecting an increase of 7.3% year over year. Organic net sales increased by 9.4%. Sales grew in both North America and the International regions. For full-year 2023, management expects organic net sales to grow by 4-6%. Also, management expects pricing efficiencies to drive gross margin recovery in 2023.
Acquisition Benefits: The company believes in strengthening its businesses by adding assets. In April 2022, Kraft Heinz acquired a majority stake in a Brazil-based condiments and sauces company — Companhia Hemmer Indústria e Comércio ("Hemmer"). Also, in January 2022, Kraft Heinz acquired an 85% stake in Germany-based Just Spices GmbH (“Just Spices”). This apart, its buyout of sauces-focused business — Assan Foods — from Kibar Holding in October 2021 is also noteworthy. Notably, acquisitions contributed 1.6% to the International segment’s revenues in the first quarter.
Strategic Partnership: In March 2023, KHC unveiled its expanded partnership with BEES. With this partnership, the company will be able to digitize its sales process and spur growth in Latin America. The deal will also enable Kraft Heinz to gain access to previously unreachable retailers. It will help grocery store chains, small “mom & pop” shops and foodservice organizations browse and stock a wide range of Kraft Heinz products. Also, this will allow the company to enhance its Emerging Markets strategy by boosting the distribution network and serving the needs of regional retailers in the area.
Transformation on Track: Kraft Heinz remains committed to boosting its profit and enhancing long-term shareholders’ value. With regard to this, management unveiled AGILE@SCALE in February 2022. The strategy has been helping KHC enhance its agile expertise and capabilities through partnerships with technology giants and cutting-edge innovators.
Celsius Holdings specializes in commercializing healthier, nutritional foods, beverages and dietary supplements. The Zacks Consensus Estimate for CELH’s current financial-year sales suggests 70.4% growth, while earnings per share are expected to rise by 154% from the corresponding year-ago reported figures. The company’s earnings surprise in the last reported quarter was 81.8%.
Conagra Brands operates as a leading branded food company in North America. The Zacks Consensus Estimate for CAG’s current financial-year sales and earnings per share suggests growth of 7.1% and 17%, respectively, from the corresponding year-ago reported figures. The company has a trailing four-quarter earnings surprise of 13.2%, on average.
Barfresh Food manufactures and distributes ready-to-blend beverages. The company’s earnings surprise in the last reported quarter was 0%. The Zacks Consensus Estimate for BRFH’s current financial year sales suggests growth of 33.8%, while earnings are likely to grow 53.7% from the prior-year reported numbers.
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Reasons Why Kraft Heinz (KHC) Should be in Your Portfolio
The Kraft Heinz Company (KHC - Free Report) is well-poised for growth, courtesy of strength across its end markets, effective pricing actions, acquired assets and strategic partnerships. The company is focused on investing in growth opportunities, solidifying its long-term market position and staying committed to shareholder returns.
Image Source: Zacks Investment Research
This Zacks Rank #2 (Buy) company has a market capitalization of $45.6 billion. Over the past year, it has gained 1.2% compared with the industry’s growth of 11.9%.
Let’s delve into the factors that have been aiding this manufacturer of food and beverage products for a while now.
Business Strength: Kraft Heinz has been benefiting from strength across its foodservice, retail and emerging markets. The company’s robust pricing actions are likely to continue working well amid cost inflation. In the first quarter of 2023, the company generated net sales of $6,489 million, reflecting an increase of 7.3% year over year. Organic net sales increased by 9.4%. Sales grew in both North America and the International regions. For full-year 2023, management expects organic net sales to grow by 4-6%. Also, management expects pricing efficiencies to drive gross margin recovery in 2023.
Acquisition Benefits: The company believes in strengthening its businesses by adding assets. In April 2022, Kraft Heinz acquired a majority stake in a Brazil-based condiments and sauces company — Companhia Hemmer Indústria e Comércio ("Hemmer"). Also, in January 2022, Kraft Heinz acquired an 85% stake in Germany-based Just Spices GmbH (“Just Spices”). This apart, its buyout of sauces-focused business — Assan Foods — from Kibar Holding in October 2021 is also noteworthy. Notably, acquisitions contributed 1.6% to the International segment’s revenues in the first quarter.
Strategic Partnership: In March 2023, KHC unveiled its expanded partnership with BEES. With this partnership, the company will be able to digitize its sales process and spur growth in Latin America. The deal will also enable Kraft Heinz to gain access to previously unreachable retailers. It will help grocery store chains, small “mom & pop” shops and foodservice organizations browse and stock a wide range of Kraft Heinz products. Also, this will allow the company to enhance its Emerging Markets strategy by boosting the distribution network and serving the needs of regional retailers in the area.
Transformation on Track: Kraft Heinz remains committed to boosting its profit and enhancing long-term shareholders’ value. With regard to this, management unveiled AGILE@SCALE in February 2022. The strategy has been helping KHC enhance its agile expertise and capabilities through partnerships with technology giants and cutting-edge innovators.
3 Other Key Picks
Some other top-ranked stocks are Celsius Holdings, Inc. (CELH - Free Report) , Conagra Brands, Inc. (CAG - Free Report) and Barfresh Food Group, Inc. (BRFH - Free Report) . CELH currently sports a Zacks Rank #1 (Strong Buy), CAG and BRFH carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Celsius Holdings specializes in commercializing healthier, nutritional foods, beverages and dietary supplements. The Zacks Consensus Estimate for CELH’s current financial-year sales suggests 70.4% growth, while earnings per share are expected to rise by 154% from the corresponding year-ago reported figures. The company’s earnings surprise in the last reported quarter was 81.8%.
Conagra Brands operates as a leading branded food company in North America. The Zacks Consensus Estimate for CAG’s current financial-year sales and earnings per share suggests growth of 7.1% and 17%, respectively, from the corresponding year-ago reported figures. The company has a trailing four-quarter earnings surprise of 13.2%, on average.
Barfresh Food manufactures and distributes ready-to-blend beverages. The company’s earnings surprise in the last reported quarter was 0%. The Zacks Consensus Estimate for BRFH’s current financial year sales suggests growth of 33.8%, while earnings are likely to grow 53.7% from the prior-year reported numbers.