FUNMAN
4 years ago
5 Bargains in Berkshire's Portfolio
We think these holdings look undervalued.
Susan Dziubinski
Aug 20, 2020
To read about more than KHC, read the article at this link:
https://www.morningstar.com/articles/998412/5-bargains-in-berkshires-portfolio
Last week, Berkshire Hathaway (BRK.A)/(BRK.B) released its second-quarter 13-F. Morningstar's resident Berkshire specialist, Gregg Warren, noted that the behemoth was a net seller of equities during the quarter. True, Berkshire picked up shares of Barrick Gold (GOLD) and bumped up its stakes in Liberty SiriusXM (LSXMA), Store Capital (STOR), Kroger (KR), and Suncor Energy (SU). However, each of these pickups accounts for less than 1% of Berkshire's portfolio, reminds Warren.
As for sales, Warren Buffett revealed during Berkshire's virtual annual meeting that the team had sold its entire airline stake in April. Moreover, Berkshire jettisoned its stake in Goldman Sachs (GS) and trimmed its overall exposure to financials stocks during the quarter.
Given the market's exceptional bounceback during the second quarter, bargains are less bountiful than they were three months ago. That said, here's a look at a handful of stocks in Berkshire Hathaway's portfolio that are undervalued by our standards.
Kraft Heinz Company (KHC)
Morningstar Rating (as of Aug. 18, 2020): 4 stars
Morningstar Economic Moat Rating: None
"Five years have passed since the marriage between Kraft and Heinz. Although the initial motivation of the tie-up was enhanced profitability (which ultimately impaired its competition position), we believe the firm is charting a new course following the appointment of CEO Miguel Patricio in 2019. Patricio has yet to make his strategic agenda public, but we don't believe that implies Kraft Heinz has pushed pause on efforts to steady its ship.
"We still expect the strategic playbook to be anchored in pursuing sustainable efficiencies versus blindly rooting out costs as the company elevates brand spending (marketing and product innovation) and enhances its capabilities (category management and e-commerce). We continue to expect marketing, research, and development to expand to more than 5% of sales in the aggregate over our 10-year forecast versus less than 5% the past few years.
"Packaged food players as well as grocery stores have suggested that consumers have increasingly sought out trusted brands (like those in Kraft Heinz's mix) since the onset of the pandemic, in line with the boost in household penetration and repeat purchase rates that Kraft Heinz has experienced. However, we expect the recent pace of gains prompted by COVID-19 stock-up trips will slow over the next several quarters as consumers work through their pantries and resort to away-from-home food consumption as social distancing mandates are eased.
"We don't expect Kraft Heinz to merely ride these tailwinds. Rather, we view this environment as an opportunity to pick up the pace on the change that has just gotten underway at the organization. We've been encouraged by Kraft Heinz's renewed commitment to enhance its service levels with retail customers--relationships that had been tarnished under prior leadership. This aim has gained heightened importance against the current backdrop, evidenced by the decision to focus manufacturing assets on the company's highest-turning stock-keeping units and even to enlist the help of co-manufacturers (despite the higher cost). We view this as prudent."
FUNMAN
4 years ago
Kraft Heinz Company: A Large Scale Efficient Food Manufacturer
Aug. 20, 2020 3:18 PM ET|4 comments | About: The Kraft Heinz Company (KHC), Includes: GIS, MDLZ
By: Chetan Woodun
Read here to see all of the charts.
https://seekingalpha.com/article/4369997-kraft-heinz-company-large-scale-efficient-food-manufacturer
Summary
The doubters have been proved wrong and the Kraft and Heinz company is benefiting from improvement in both top-line and bottom-line.
The reason is not only due to COVID as evidenced by the tracker I use to analyze results of the transformation plan launched last year.
The company is also looking stronger than competitors.
I take a deep look at the challenges for the next quarter taking into consideration the very ingredients which led to an upbeat performance in the first half of the year.
KHC is undervalued when taking into consideration its ability to derive better operational margins from COVID-19.
Many were doubting that the higher consumer demand the Kraft Heinz Company (KHC) was witnessing for its products in Q1-2020 would continue in the second quarter.
This high demand in the first quarter was solely being attributed to panic-led stockpiling amid the coronavirus outbreak.
However, higher second quarter sales both in comparison to Q2-2019 and Q1-2020 figures proved that there was more to it than just stockpiling.
Also, in terms of bottom-line, there were better-than-expected EBITDA margins.
Figure 1: KHC's quarterly revenue
ChartData by YCharts
Still, despite these positives, challenges still lie ahead.
Hence, I evaluate how the action plan formulated in the third quarter of 2019 by the new management team to address marketing, supply chain and operational efficiency has delivered results and can continue to bring improvements in the second half of the year.
For this purpose, I have elaborated a strategic plan tracker.
I will also address the competitive position as well as touch upon COVID-related specific consumer patterns which can impact on growth.
To begin with, I analyze the revenues and finances.
Preliminary results of the strategic plan
The company is still amid a re-organization process as the pandemic weathers through. The COVID-induced stay-at-home phenomenon has resulted in increased demand and this has been beneficial.
However, the pandemic has also brought challenges especially in terms of supply chain. Here the operations team has worked hard to optimize manufacturing capacity to meet demand with some plants running on a 24/7 basis.
Despite their efforts, there was some loss of market share for meat and cheese products as products were not available in time.
Still, KHC managed to increase gross margins to 37% for Q2-2020, more than 4% higher compared to the previous quarter as the company was able to mitigate incremental COVID costs incurred in terms of overtime and protective equipment costs.
The company owes this success to a re-examination the stock-keeping process in the US and streamlining the complexities out of the system resulting in the route from production lines to market becoming more nimble.
Figure 2: Tracker to evaluate how strategy has been translated to action
Source: Keylogin strategic analysis
Also, KHC is working hard on marketing and consumer profiling in terms of geography and demographics in order to target a more diverse population.
In this context, younger consumers with higher income levels coming from areas which were not previously indexed by KHC have been buying items like peanut butter and pasta sauce, thus providing the company with a diversification opportunity.
KHC's customer base has traditionally included more of the baby-boomer generation of shoppers.
In terms of figures, higher sales has resulted in 75% of KHC's brands being adopted by more households and also increasing repeat rate among the new buyers.
Promotional campaigns carried out during the second quarter have resulted in higher SG&A expenses compared to Q1-2020 but this was money well-spent as the revenues and profitability figures show.
Figure 2: Revenues by quarter with all figures in millions of dollars.
Source: SeekingAlpha
Going forward, KHC plans to re-deploy more of its marketing expenses towards loyalty campaigns thus further tapping into its new base of recently acquired customers.
Also, I see more promotional activities leading to lower prices and more sales in the second half.
Figure 3: McCafé
Good is Brewing
Source: MacDonald
On the other hand, one of the headwinds is constituted by the McCafé's exit that has been underway in Canada in the first half of the year and which also began impacting US sales as from July.
Other possible headwinds going forward are incentive compensation and unfavorable commodity costs mainly to be incurred for cheese.
However on the positive side, the higher COVID-led demand seen in the first half should be maintained through aggressive marketing and the ability of the company's supply chain to channel goods more efficiently.
To this end, some of the supply chain constraints faced for meat products have already been mitigated.
Here, higher gross margins together with the fact that the company is redeploying marketing resources instead of incurring in additional recruitment should result in operational margins staying on the high side.
Moreover, to a lesser extent, foreign exchange translation which was a headwind in the first half with the strong dollar could be less of a drag in the third quarter with both the Canadian Dollar and British Pound having seen strength in international FOREX markets.
Most importantly, KHC has been able to establish a strong base from where it should not only sustain top-line growth but also maintain profitability.
Therefore, going forward, there is real possibility for the headwinds to be offset.
Figure 4: Evaluation of the headwinds in the second half of the year.
Source: Keylogin evaluation matrix built with some data obtained from earnings report for Q2-2020.
I now go deeper into the finances.
In this respect, as of June 30 cash available was $2.8 billion while long term debt was $28.1 billion. Now, through July, $1 billion of the 2020 debt maturities was paid with cash, reducing outstanding gross debt.
Figure 5: Balance sheet with all figures in millions of dollars
Source: SEC filings
The liquidity position is strong with no meaningful refinancing needs for the next five years and the refinancing transaction performed back in May.
KHC is reducing debt and ensuring that there is sufficient free cash flow ($2.3 billion as at June 30) to ensure dividend payments.
Debt to equity is at 58.70, the lowest among peers.
Current payout ratio is currently at 62% for a yield of 4.5% and this is the highest among competitors.
The competition
First, there seems to be a lot of outdated information when it comes to looking for KHC's competitors.
This is also the case with some commentators whose memories appear to be stuck in the past, more particularly in February of 2019 when KHC had lost the one thing for which it was prized by investors: its profit margins.
Hence, there is a general sentiment that the stock is "struggling".
Figure 5: Outdated results when comparing KHC with Mondelez (MDLZ) through a google search.
Source: Google.com
However, things have now changed, and the company's operating margin is back to above the 20% mark.
That steep rise from March to June when compared to the competition shows that KHC has been able to take advantage of COVID-led opportunities in a much more efficient way.
Figure 6: A comparison of the operating margins showing how KHC has benefited more from COVID-led demand than competitors Mondelez and General Mills (GIS).
Source: Chart built from data from SeekingAlpha
The underlying reasons for this achievement a better leverage on supply chain, higher volumes and better product mix.
Now, some may be wondering if the margins could burst through the 25% level by the end of the year as the improvements the company is bringing to its operational efficiency start to really bite.
In order to get more clarity, I go through the challenges.
The challenges
The first challenge is the favorable consumer behavior seen in the first half simply being absent in the second half of the year.
However, there are studies which indicate otherwise.
In this context, a study by restaurants.org indicates that restaurant sales continued to rise in July, but at a much slower pace.
For consumer staples plays, this means that the "favorable shift" between retail and food-service (people eating in restaurants instead of purchasing packaged food) they benefited from in the first half of the year is not completely gone.
Moreover, according to the same survey, "after the initial bounce in May and June, July's sales results are a reminder that the restaurant industry's road to recovery will be long and uneven".
Figure 7: Sales generated by eating and drinking places.
Source: Restaurants.org
Also, in the UK, one of KHC's largest international markets, restaurants were allowed to re-open on July 4, 2020 only under strict hygiene conditions to prevent a second wave of virus.
This means that while there will be a reduction in volume of good sold, the trend seen in the packaged food industry should continue to be favorable to KHC.
Now, according to another study by McKinsley, COVID-19 has disrupted the positive trend seen in small packaged food manufacturers during recent years.
The study also mentions of a more pronounced liking for conscious eating and living.
These two findings can only be beneficial to larger food manufacturers like KHC offering natural food brands.
Therefore, customer consumption pattern should continue to be favorable going forward.
Interestingly, Michael Lavery, an analyst at Piper Sandler's also expects pronounced eating-at-home trends to drive a "sustainable lift" at least into 2021.
According to him, KHC is well-positioned with a more meal-oriented product offerings and lesser food-service exposure.
Now, less food-service exposure also means less vulnerability to an economic downturn.
Also, the ability of KHC's operations team to drive down the cost of goods sold and its marketing department to re-deploy resources (instead of spending money on additional resources) during promotional campaigns are key to maintaining profitability levels.
I now provide an indication for the target price.
Valuations and key takeaways
With superior profitability margins, KHC is the only company which seems to have taken the most advantage from the surge in COVID-led demand, may be as a result of the new CEO being able to think out-of-the box.
Figure 8: Comparing the valuations
Source: SeekingAlpha
Hence, according to all metrics, namely price to earnings, price to sales and EV to EBITDA ratios, valuations for KHC is on the lower side.
I get a value of $38-42 which is aligned with Piper Sandler's target of $39.
My bullish instance is reinforced through the actions of the new management which is implementing a new operating model to improve performance on a sustainable basis.
Second, winning younger customers with more purchasing power means greater opportunity to sell natural food as the Gen-Z and millennials are more likely to favor organic Foods according to Packaged Facts.
In this context, it would be useful to get updated as to the amount of sales being conducted online given the fact that behaviors are changing as more adults stay and therefore dine alone and kids eat more lunches at home versus school.
Looking further down the road, some of the progress made has delivered results but much still remains to be seen as changes are still being brought to the organization.
As a holder since March 2018, I am now confident that the ingredients are here to ensure profitable and sustainable growth after some stimulus from the coronavirus.
In addition, the fact that the company has less exposure to the food-service business earns it a better position to weather the forthcoming economic downturn.
Finally, food is an essential commodity and KHC as a large scale food-manufacturing company ensures that despite disruptions, it continues to be available in retail stores.
Therefore, at current stock prices, the company is a buy.
Disclosure: I am/we are long KHC. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
FUNMAN
4 years ago
Too bad for KHC - Unilever trials geolocation tech to tackle deforestation in palm oil supply chains
19 August 2020, source edie newsroom
https://www.edie.net/news/7/Unilever-trials-geolocation-tech-to-tackle-deforestation-in-palm-oil-supply-chains/
Unilever is piloting new geolocation technology in a bid to ensure it meets its zero-deforestation targets, which cover supply chains including palm oil, soy and paper and board.
Developed by US-based firm Orbital Insight, the technology leverages GPS data and satellite images to identify patterns of land use and traffic. In regions where there is a consistent flow of traffic between agricultural land and a mill, the technology will predict the likelihood that a farm or plantation is supplying a mill and, in turn, the possibility of deforestation.
Unilever hopes that the technology can help it overcome challenges around securing the visibility of the “first mile” of commodity journeys. Palm oil and soy are particularly challenging to trace, given that crops are often harvested from many different areas and mixed either at the mill or before reaching it.
The consumer goods giant is already using satellite imagery to monitor farms and plantations across its global supply chains but hopes the new technology could make the identification of potential environmental risks more accurate and rapid. Its current approaches largely rely on drawing a radius around land and identifying mills within that area. Unilever also hopes that the technology will help other companies across the value chains of the commodities it sources.
"Better monitoring helps all of us to understand what's happening within our supply chains," Unilever’s chief supply chain officer Marc Engel said.
"By companies coming together and using cutting-edge technology to carefully monitor our forests, we can all get closer to achieving our collective goal of ending deforestation."
Unilever is no stranger to using innovative technologies for supply chain management, having recently implemented blockchain to tea supply chains in a drive to improve social sustainability.
A pivotal moment for palm oil
Palm oil is found in a wide range of foods and some cosmetics and household goods, but its production is often problematic. The race to satisfy growing demand over the past two decades has resulted in vast plantations replacing native forest in countries in south-east Asia, while efforts to prevent forest destruction have often been stymied by corruption or companies flouting the rules.
Unilever has a commitment to reach zero net deforestation in key supply chains, including palm oil, by the end of 2020. As of 2019, the firm was 95% of the way towards this target for palm oil and had met it for paper and soy. Progress was slower, however, for sunflower oil.
While Unilever is the world’s largest single buyer of palm oil, purchasing around 3% of the total amount produced globally each year, it is not the only firm to have made such a commitment. There is, in fact, an industry-wide commitment across the consumer goods sector to tackle deforestation by 2020, binding firms which do not eliminate deforestation from their supply chains to plant trees to ‘offset’ this impact.
CDP warned late last year that just one-third of the 22 firms to have signed this commitment had deployed comprehensive management practices around forestry and land use. Unilever was praised for its efforts, while the likes of Kraft Heinz and Yum! Brands were named as laggards.
Similar research has since been conducted by WWF and Rainforest Action Network. The conclusion was the same; that the FMCG sector is off track to meeting its deforestation commitments.
The Covid-19 pandemic has caused the first global drop in palm oil demand and production since records began. Time will tell if the sector will undergo a truly green recovery.
Sarah George
FUNMAN
4 years ago
Maxwell House Launches New Zero Waste Single-Serve Coffee Pods
NEWS PROVIDED BY
Good move. - FUNMAN
Kraft Heinz Canada
Aug 17, 2020, 08:00 ET
https://www.newswire.ca/news-releases/maxwell-house-launches-new-zero-waste-single-serve-coffee-pods-863920440.html
"Good to the last drop. And long after" reflects a commitment to a more sustainable future and to the next generation of coffee drinkers.
TORONTO, Aug. 17, 2020 /CNW/ - Canadian icon Maxwell House has always been, "Good to the last drop." Now, thanks to a bold new 100% compostable pod innovation launch, it's "Good to the last drop. And long after."
Serving as a stamp of the brand's commitment to sustainability, the launch of Maxwell House 100% compostable coffee pods provides an alternative to the popular single-serve pods. Made entirely from plant-based materials, all pod components and its inner bag are 100% compostable, plus the outer carton is 100% recyclable, leaving zero waste for the consumer. This helps Canadians reduce waste without sacrificing the convenience of single-serve pods or the rich flavour of Maxwell House coffee they know and love.
"We recognize the significant concern packaging waste presents and we are working collectively at all levels of our operations to explore alternative solutions," says Nicole Fischer, Head of Sustainability, Kraft Heinz Canada. "Through ongoing collaboration with packaging experts, organizations and coalitions, Kraft Heinz Canada is working towards a circular economy to ensure real measures are taken to reduce single-use plastics and divert food waste from our landfills, limiting harmful impacts to our environment."
With the launch of Maxwell House 100% compostable coffee pods, waste reduction is at the forefront, with sustainable packaging from beginning to end. It's a simple one-step process: toss the pod into the compost bin and it will decompose into nutrient rich soil. Leaving zero waste for the consumer, the compostable coffee pods are made of 85% coffee grounds (real, actual coffee) with a paper lid, a coffee filter made from cornstarch and a plant-based compostable ring made from over 20% coffee bean husks.
Certified by the Biodegradable Products Institute, this designation verifies that the compostable coffee pod meets global scientific standards for industrial compostability and is formulated to break down in a period of about seven weeks. Gone are the days of tedious separation of recyclable pod elements, including the removal of the lid, ring, mesh filters and coffee grounds. Further, organization into the correct recycling and composting categories is no longer required.
Dr. Calvin Lakhan, industry expert and leading environmental researcher at Toronto's York University says, "Both brands and consumers have a critical role to play in driving sustainability forward through innovative technology and developing solutions that balance the demands of modern society with the needs of the planet. By making the switch from traditional single-use plastic pods to compostable pods, we could help reduce plastics by the height of more than 4,000 CN towers annually."
As a way to showcase the innovation, Maxwell House launched an immersive educational experience to highlight how the pods decompose. Located at stackt market in downtown Toronto, visitors can witness first-hand how the compostable pods break down over the next few weeks in a shipping container filled with 500 lbs. of shredded organic material, such as expired fruits and veggies, and the 100% compostable pods.
By the end of the process, all the pods used to create the experience will break down completely so all that is left is nutrient rich soil. Time lapse assets of the decomposition experience will also be shared with Canadians across social media to demonstrate the reality of the process. To learn more and witness the science behind the pods, visit @MaxwellHouseCA on Instagram, Facebook and Twitter.
The launch will also be supported with a national TV-led campaign spanning digital, social, PR, e-commerce and in-store activations.
Kraft Heinz will be releasing its 2020 Environmental, Social, Governance (ESG) report as part of its corporate citizenship and sustainability efforts in Fall 2020. The report highlights its commitment to sustainability, including the company's aim to make 100% of packaging recyclable, reusable or compostable by 2025.
ABOUT KRAFT HEINZ CANADA
Kraft Heinz Canada is the country's largest food and beverage company and is a subsidiary of Kraft Heinz (NASDAQ: KHC). Kraft Heinz Canada provides high quality, great taste and nutrition for all eating occasions whether at home, in restaurants, or on the go. Kraft Heinz Canada products are found in more than 97 per cent of Canadian households. The company's iconic brands include Kraft Peanut Butter, Heinz Ketchup, KD, Philadelphia Cream Cheese, Renées Dressing, Jell-O, Classico, Kool-Aid and Maxwell House. Kraft Heinz Canada is dedicated to the sustainable health of our people, our planet and our company. For more information, please visit www.kraftheinzcompany.com.
SOURCE Kraft Heinz Canada
For further information: Media inquiries: Stella Karami, skarami@getproof.com, 647-884-9651
FUNMAN
4 years ago
Kraft Heinz Names New Executives to the Company’s U.S. Leadership Team
August 13, 2020 at 8:00 AM EDT
http://ir.kraftheinzcompany.com/news-releases/news-release-details/kraft-heinz-names-new-executives-companys-us-leadership-team
Leadership Hires in Sales, Marketing, and Communications Will Advance the Company’s Strategic Plans for the U.S. Business
PITTSBURGH & CHICAGO--(BUSINESS WIRE)--Aug. 13, 2020-- Today, the Kraft Heinz Company (Nasdaq: KHC) celebrated another milestone in the company’s turnaround plan with the finalization of its U.S. Leadership Team, naming Cory Onell as President of U.S. Sales; Sanjiv Gajiwala as U.S. Chief Growth Officer; and Stephanie Peterson as Head of U.S. Communications.
The appointment of three new senior executives to key leadership positions underscores the company’s commitment to driving sustained growth through customer-centric innovation, strategic investments, and talent development. Leveraging extensive functional expertise and business acumen, each leader will bring new, complementary capabilities to the company’s U.S. business, the largest of the organization, and help shape the future of Kraft Heinz.
“I am thrilled to welcome Cory, Sanjiv, and Stephanie to the Kraft Heinz family and believe they will add tremendous value to our business by helping accelerate our transformation agenda and drive growth,” said Carlos Abrams-Rivera, U.S. Zone President for Kraft Heinz. “With their inclusion on our U.S. Leadership Team, we’re adding critical, best-in-class Sales, Marketing, and Communications capabilities that will help us build a new Kraft Heinz fueled by innovation, insights and agility.”
Cory Onell joins Kraft Heinz with more than 20 years of experience leading Sales organizations for Consumer Packaged Goods companies. As the head of the U.S. Sales organization, he will drive customer and channel growth by creating dynamic solutions that generate shared value while leveraging the power of the iconic Kraft Heinz portfolio to reclaim category leadership. Most recently, Onell served as Senior Vice President of Sales and the Head of U.S. Retail and Customer and Commercial Teams for the J.M. Smucker Company after successful stints at Campbell Soup Company, Kimberly-Clark Corporation, Mondelez International and Kraft Foods.
As the U.S. Chief Growth Officer, Sanjiv Gajiwala will champion the company’s consumer obsession in this newly created role. Leveraging rich insights and analytics, he will lead the charge in commercializing breakthrough innovations that speak directly to consumer needs and differentiate Kraft Heinz while applying a strategic omnichannel approach to help bring the company’s beloved brands to life in new and exciting ways. Gajiwala joins Kraft Heinz from Mike's Hard Lemonade Co., the leader in the Flavored Malt Beverage category, where most recently he served as Senior Vice President of Marketing.
Having joined Kraft Heinz at the end of May as the first Head of U.S. Communications, Stephanie Peterson will lead all internal and external communications efforts for the Zone business. Before Kraft Heinz, Peterson served in senior-level communications roles at PepsiCo, KIND Snacks, and, most recently, IHOP Restaurants, where she led the communications function, spearheading executive visibility and franchisee communications as well as multi-faceted PR campaigns and experiential marketing initiatives that turned the iconic breakfast chain into one of the most relevant pop-culture brands of the last decade.
Onell, Gajiwala, and Peterson all report to Kraft Heinz U.S. Zone President Abrams-Rivera.
ABOUT THE KRAFT HEINZ COMPANY
For 150 years, we have produced some of the world’s most beloved products at The Kraft Heinz Company (Nasdaq: KHC). We are one of the largest global food and beverage companies, with 2019 net sales of approximately $25 billion. Our portfolio is a diverse mix of iconic and emerging brands. As the guardians of these brands and the creators of innovative new products, we are dedicated to the sustainable health of our people and our planet. To learn more, visit www.kraftheinzcompany.com or follow us on LinkedIn and Twitter.
View source version on businesswire.com: https://www.businesswire.com/news/home/20200813005232/en/
Stephanie Peterson, Head of U.S. Communications
Stephanie.Peterson@kraftheinz.com
Christopher Jakubik, CFA (Investors)
ir@kraftheinz.com
Source: The Kraft Heinz Company
FUNMAN
4 years ago
Planters Mascot Mr. Peanut Redesigned as Baby Nut
https://www.packagingstrategies.com/articles/95577-planters-mascot-mr-peanut-redesigned-as-baby-nut
July 2, 2020
Baby Nut, the cute newborn version of Planters’ classic mascot Mr. Peanut who made his debut at the Super Bowl this year, will appear on Planters packaging. On the packaging, a wide-eyed Baby Nut clutches a peanut with an awestruck look on his face. The tagline reads: “That’s one cute nut!”
Baby Nut came to life during Planters’ Super Bowl spot after a pregame ad showed the original Mr. Peanut dying in a nutmobile accident to save pals Wesley Snipes and Matt Walsh. At Mr. Peanut’s funeral, a tear from the Kool-Aid Man landed on the plot, sprouting a peanut plant that brought Mr. Peanut back to life as Baby Nut.
Since his resurrection, Baby Nut has been reading stories to kids in animated videos created for a campaign that ran during the early days of the COVID-19 pandemic after a social media hiatus following the Big Game.
If fans of Baby Nut want to get their hands on Planters packaging featuring his photo, they’ll need to act fast. The packaging is a limited edition run, and as Maya McDonald, head of social and digital across beverages, snacks and desserts at Kraft Heinz, previously told Adweek, he won’t be a baby forever.
“He has the spirit of Mr. Peanut, and he is going to be growing back into his previous form,” she said in April. “So we have a lot of different fun things on the horizon as he goes back to Mr. Peanut, but we’re definitely enjoying doing some fun things with Baby Nut right now, and you’ll see a lot more Baby Nut in the next few months.”
conix
5 years ago
Kraft-Heinz 5.25% Yield Is A Buy
Posted on Thursday, April 30th, 2020 by Thomas Hughes
Consumer Staples, It’s What You Want To Own
The consumer staples (XLP) stocks have been on a tear and no wonder. The global coronavirus pandemic is driving people to stay home, stock up, and social-distance, and that means big spending in the staples categories. Companies like Conagra (CAG), General Mills (GIS), the JM Smucker Company (SJM), and Kellogg (K) have all been reporting goods news. news like increased organic sales, improved profits, and positive outlook, and that has been driving their shares back to pre-virus levels and higher.
Today’s spotlight is on Kraft-Heinz (KHC). The global food-staple behemoth reported better than expected top and bottom-line results and a very favorable outlook. Where most S&P 500 companies are going to see their revenue and earnings fall sharply in Q2 Kraft sees a modest increase for both. Don’t forget, Q2 is going to be the worst-hit quarter regarding earnings for the “average company” as most major markets are in lockdown.
What The Consumers Say
When it comes to what the consumers say, following the money is always the best bet. When it comes to Kraft-Heinz, the consumers say they want what the company is selling. Revenue in the 1st quarter not only grew 3.3% from the previous year but came in above the consensus forecast. Earnings, due to a combination of pricing, volume, and mix, also grew from the previous year to beat the consensus expectation.
The average price per case sold increased by 1.6% over the last year showing the company’s ability to pass cost increases on to the consumer. Volume and mix added a total of 4.6% of growth to the results bringing organic growth to nearly 6.2% for the quarter. In the U.S., comps rose 6.4% while Internationally they rose a slightly-more robust at 6.9%.
The only bad news is that Kraft management decided to pull the full-year guidance. The silver lining is that Kraft, like so many others, is positioned to do well during the pandemic. The reason for the guidance-pull more than mitigates its existence; Kraft thinks its current guidance may be too low but is unwilling to say so. Based on the current results and what guidance they were able to provide, the analyst’s consensus is too low and in need of upward revision. As it stands now, the analysts see 2020 revenue growth as flat to slightly negative.
The Dividend, A Healthy 5%
Kraft-Heinz is not well known as a dividend-grower, far from it in fact, but that does not negate its attractiveness today. At today’s prices, Kraft is paying more than 5% with very little expectation the distribution will be cut. Along with today’s release, Kraft issued its next distribution declaration assuring the next payment safe at least.
Beyond that, Kraft is earning plenty to cover its payment despite a slightly-higher than preferred 68% payout ratio. Assuming the company can at least meet consensus over the next two years that should not become a problem. In terms of cash-flow and debt, Kraft is carrying some debt but it’s well-managed long-term debt the company has been working hard to reduce. It was just 1.5 years ago Kraft cut its dividend to $0.40 quarterly in order to accelerate the "deleveraging process to provide greater balance sheet flexibility." That process is ongoing.
The Technical Outlook: A Vee-Shape Recovery Is In Process
A quick look at the chart of KHC prices will show you an asset in the process of recovery. This stock saw a massive correction that shaved 37.5% off its 2020 highs and then a nice rebound. The bottom is more like a quick double-bottom than a true Vee-shaped recovery but that’s not a concern.
What is a concern is that price action appears to be flagging and the indicators are consistent with a top. This may lead the stock to correct again, possibly as low as the $28 level, despite the generally bullish outlook. If KHC falls to the EMA and confirms support I would be a buyer. Likewise, if the stock price stabilizes at today’s levels and moves above $30.25 I would also be a buyer.
FUNMAN
5 years ago
For the First Time Ever, PLANTERS Launches New Cheez Balls Flavors, Including Blazin’ Hot
February 14, 2020 at 3:58 PM EST
These cheese balls do nothing to make me feel better about the more than 10% haircut we took this week. - FUNMAN
PLANTERS White Cheddar and Nacho Cheez Balls also are among new flavors
PITTSBURGH & CHICAGO--(BUSINESS WIRE)--Feb. 14, 2020-- For the first time ever, PLANTERS is launching all new flavors of everyone’s favorite 90s treat, Cheez Balls!
Just in time for the upcoming basketball madness, PLANTERS is giving fans a flavor slam dunk with new White Cheddar, Nacho and Blazin’ Hot Cheez Balls! Whether fans are feeling extra cheezy or want to bring some heat to their taste buds, these Cheezballin’ snacks are a new twist on the classic neon orange goodness fans know and love.
“There has been incredible excitement around the return of PLANTERS Cheez Balls over the past few years,” said Samantha Hess, brand manager for PLANTERS. “We know fans love the cheezy flavor of Cheez Balls, but they also crave new and interesting flavor options. We created these new versions to give fans what they want, and we can’t wait for America to get their cheezy hands on them.”
PLANTERS White Cheddar and Nacho Cheez Balls are available nationwide now. Blazin’ Hot Cheez Balls will start scorching the snack aisle beginning May 2020. A fourth new flavor, Jalapeno Cheddar Cheez Balls, will be available nationally later this year.
For more information on Cheez Balls or other PLANTERS products, visit Planters.com. Fans can also find the latest about Baby Nut on Twitter (@MrPeanut).
About The Kraft Heinz Company
For 150 years, we have produced some of the world’s most beloved products at The Kraft Heinz Company (NASDAQ: KHC). Our Vision is To Be the Best Food Company, Growing a Better World. We are one of the largest global food and beverage companies, with 2018 net sales of approximately $26 billion. Our portfolio is a diverse mix of iconic and emerging brands. As the guardians of these brands and the creators of innovative new products, we are dedicated to the sustainable health of our people and our planet. To learn more, visit http://www.kraftheinzcompany.com/ or follow us on LinkedIn and Twitter.
View source version on businesswire.com: https://www.businesswire.com/news/home/20200214005486/en/
Source: Kraft Heinz Company
Lynne Galia
Kraft Heinz
847-646-4396
lynne.galia@kraftheinz.com
Taylor Higgins
ICF Next
312-577-1773
taylor.higgins@icfnext.com
FUNMAN
5 years ago
DD Research talks Kraft dividends
Feb. 12, 2020 9:25 AM ET|About: The Kraft Heinz Company (KHC)|By: Clark Schultz, SA News Editor
https://seekingalpha.com/news/3541056-dd-research-talks-kraft-dividends
* DD Research analyst David Driscoll digs into the tricky question of what Kraft Heinz (NASDAQ:KHC) might do with its lush dividend as the food company's debt to EBITDA ratio moves to an uncomfortable level.
* Driscoll notes that by the strict math of DD's financial projections, it looks like the dividend can be maintained at current levels. "However, this requires that our expectations for business reinvestment are reasonably accurate. If, for instance, management wants to reinvest at a faster rate to turn the business sooner, then EBITDA will likely come in lower than forecasted, which would likely require a dividend cut to give the company a bit of breathing room," he warns.
* The second alternative seen by Driscoll is if Kraft management decides to sell some assets and maintains the dividend.
* "In our opinion, the dividend is nice, but we put more weight on the underlying fundamentals when weighing the merits of Kraft as an investment," sums up Driscoll.
* DD Research has a Neutral rating on Kraft.
FUNMAN
5 years ago
Kraft Launches Big Bowls of Mac & Cheese Ahead of Valentine’s Day, so Parents Can Get Kids Fed, Get Them to Bed and Get It On
February 5, 2020 at 7:00 AM EST
Even More Noodles & Cheese to Make a Deliciously Easy Dinner in Just 3.5 Minutes
http://ir.kraftheinzcompany.com/news-releases/news-release-details/kraft-launches-big-bowls-mac-cheese-ahead-valentines-day-so
At least they are trying to pump up their "hits". That's their turnaround plan! - FUNMAN
PITTSBURGH & CHICAGO--(BUSINESS WIRE)--Feb. 5, 2020-- Valentine’s Day should be the most romantic holiday of the year, but some parents admit that kids put a wedge in candlelit dinners and alone time. In fact, 86% of parents want to get intimate with their partner this Valentine’s Day but claim children will prevent 1 out of 4 of them from actually getting it on*. That’s why Kraft Macaroni & Cheese is giving parents a chance to win new Big Bowls before they hit stores nationwide.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200205005113/en/
(Photo: Business Wire)
(Photo: Business Wire)
New Kraft Macaroni & Cheese Big Bowls have even more of your favorite mac & cheese to make a deliciously cheesy and easy dinner in just three and a half minutes – just add water.
“We decided to launch our new Kraft Big Bowls early to give parents what they really want on Valentine’s Day, some time to get it on, “said Kelsey Cooperstein, Brand Manager at Kraft Heinz. “KraftBig Bowls is an easy and kid-pleasing dinner solution with even more cheese and noodles than our microwavable Easy Mac cups, so parents can put their kids to bed and enjoy a night of romance.”
Starting today, parents can visit http://www.kraftmacisforlovers.com to enter for a chance to win KraftMacaroni & Cheese Big Bowls in time for Valentine’s Day. Along with the KraftMacaroni & Cheese Big Bowls, parents will receive some romantic goodies which includes candles, rose petals and a card – all in the spirit of getting kids to bed and setting the mood for parents.
KraftMacaroni & Cheese Big Bowls are available online February 15 and at other national retailers starting in March.
Watch the video here: and join the conversation with Krafton Instagram @kraft_macandcheese, Twitter @kraftmacncheese, and Facebook @kraftmacaroniandcheese, using #KraftMacIsForLovers.
Open to legal residents of the 50 U.S. & D.C. (excluding AK & HI), 18 years of age and older or who have reached the age of majority in his or her state of residence. Sweepstakes starts 12:00 AM CT on 2/5/2020 and ends 2:59 PM CT on 2/9/2020. Void where prohibited. Visit KraftMacIsForLovers.com for Official Rules and to enter. Sponsor: Kraft Heinz Foods Company.
*December 2019, online panel survey based on 450 US parents
ABOUT THE KRAFT HEINZ COMPANY
For 150 years, we have produced some of the world’s most beloved products at The Kraft Heinz Company (NASDAQ: KHC). Our Vision is To Be the Best Food Company, Growing a Better World. We are one of the largest global food and beverage companies, with 2018 net sales of approximately $26 billion. Our portfolio is a diverse mix of iconic and emerging brands. As the guardians of these brands and the creators of innovative new products, we are dedicated to the sustainable health of our people and our planet. To learn more, visit http://www.kraftheinzcompany.com/ or follow us on LinkedIn and Twitter.
View source version on businesswire.com: https://www.businesswire.com/news/home/20200205005113/en/
Source: The Kraft Heinz Company
Brooke Scher Mogan
ALISON BROD MARKETING + COMMUNICATIONS
212-230-1800
kraftheinz@alisonbrodmc.com
Lynne Galia
The Kraft Heinz Company
847-646-4396
Lynne.galia@kraftheinz.com
FUNMAN
5 years ago
The Kraft Heinz Company to Report Fourth Quarter and Full Year 2019
Results on February 13, 2020
January 24, 2020 at 8:30 AM EST
http://ir.kraftheinzcompany.com/news-releases/news-release-details/kraft-heinz-company-report-fourth-quarter-and-full-year-2019
PITTSBURGH & CHICAGO--(BUSINESS WIRE)--Jan. 24, 2020-- The Kraft Heinz Company (Nasdaq:KHC) (“Kraft Heinz”) will release its fourth quarter and full year 2019 financial results on Thursday, Feb. 13, 2020, before the market opens. Kraft Heinz will host a conference call at 8:30 a.m. Eastern Standard Time that day to review and discuss the results, followed by a question-and-answer session with analysts.
The earnings release and live audio webcast of Kraft Heinz’s earnings conference call can be accessed at ir.kraftheinzcompany.com. A replay of the webcast will be available following the conference call through the same website.
ABOUT THE KRAFT HEINZ COMPANY
For 150 years, we have produced some of the world’s most beloved products at The Kraft Heinz Company (Nasdaq:KHC). Our Vision is To Be the Best Food Company, Growing a Better World. We are one of the largest global food and beverage companies, with 2018 net sales of approximately $26 billion. Our portfolio is a diverse mix of iconic and emerging brands. As the guardians of these brands and the creators of innovative new products, we are dedicated to the sustainable health of our people and our planet. To learn more, visit www.kraftheinzcompany.com or follow us on LinkedIn and Twitter.
View source version on businesswire.com: https://www.businesswire.com/news/home/20200124005234/en/
Source: The Kraft Heinz Company
Michael Mullen (media)
Michael.Mullen@kraftheinz.com
Christopher Jakubik, CFA (investors)
ir@kraftheinz.com
FUNMAN
5 years ago
Kraft Heinz Co (NASDAQ:KHC) Expected to Post Earnings of $0.69 Per Share
Posted by Lars Charter on Jan 2nd, 2020
https://rivertonroll.com/news/2020/01/02/kraft-heinz-co-nasdaqkhc-expected-to-post-earnings-of-0-69-per-share-updated.html
I sure hope these declining EPS numbers can be reversed! If not I see the PPS retracing towards the several months ago low. - FUNMAN
Brokerages expect that Kraft Heinz Co (NASDAQ:KHC) will report earnings of $0.69 per share for the current quarter, Zacks Investment Research reports. Four analysts have issued estimates for Kraft Heinz’s earnings, with estimates ranging from $0.64 to $0.73. Kraft Heinz posted earnings of $0.84 per share in the same quarter last year, which would indicate a negative year-over-year growth rate of 17.9%. The firm is scheduled to issue its next quarterly earnings results on Thursday, February 20th.
On average, analysts expect that Kraft Heinz will report full year earnings of $2.81 per share for the current year, with EPS estimates ranging from $2.77 to $2.86. For the next year, analysts anticipate that the company will post earnings of $2.57 per share, with EPS estimates ranging from $2.40 to $2.77. Zacks Investment Research’s EPS averages are an average based on a survey of sell-side research firms that follow Kraft Heinz.
Kraft Heinz (NASDAQ:KHC) last posted its earnings results on Thursday, October 31st. The company reported $0.69 earnings per share for the quarter, topping the Zacks’ consensus estimate of $0.54 by $0.15. The business had revenue of $6.08 billion for the quarter, compared to analyst estimates of $6.13 billion. Kraft Heinz had a negative net margin of 42.85% and a positive return on equity of 6.23%. Kraft Heinz’s revenue was down 4.8% on a year-over-year basis. During the same quarter in the prior year, the firm posted $0.78 EPS.
A number of equities research analysts recently commented on the stock. ValuEngine upgraded shares of Kraft Heinz from a “sell” rating to a “hold” rating in a report on Wednesday, October 2nd. BMO Capital Markets raised their target price on Kraft Heinz to $37.00 and gave the stock a “market perform” rating in a research note on Friday, November 1st. Barclays set a $32.00 target price on Kraft Heinz and gave the stock a “hold” rating in a research note on Friday, November 1st. Piper Jaffray Companies set a $33.00 price target on Kraft Heinz and gave the company a “hold” rating in a report on Friday, November 1st. Finally, Wells Fargo & Co reaffirmed a “hold” rating on shares of Kraft Heinz in a research report on Tuesday, September 3rd. Five investment analysts have rated the stock with a sell rating, sixteen have given a hold rating and two have given a buy rating to the company. The company has an average rating of “Hold” and an average target price of $32.85.
Several institutional investors and hedge funds have recently modified their holdings of KHC. SRS Capital Advisors Inc. boosted its position in Kraft Heinz by 46.3% in the third quarter. SRS Capital Advisors Inc. now owns 1,030 shares of the company’s stock worth $29,000 after purchasing an additional 326 shares during the last quarter. Ossiam bought a new position in shares of Kraft Heinz in the 2nd quarter worth approximately $31,000. Nvwm LLC purchased a new position in shares of Kraft Heinz in the third quarter worth approximately $38,000. Horan Capital Advisors LLC. purchased a new position in shares of Kraft Heinz in the third quarter worth approximately $47,000. Finally, Venturi Wealth Management LLC bought a new stake in Kraft Heinz during the third quarter valued at approximately $59,000. 57.09% of the stock is owned by institutional investors.
Shares of KHC traded down $0.35 during trading hours on Thursday, hitting $31.63. The company had a trading volume of 3,957,724 shares, compared to its average volume of 9,176,240. Kraft Heinz has a 52-week low of $24.86 and a 52-week high of $48.66. The company has a quick ratio of 0.65, a current ratio of 1.00 and a debt-to-equity ratio of 0.54. The stock’s 50 day moving average price is $31.53 and its 200 day moving average price is $29.55. The firm has a market cap of $38.98 billion, a P/E ratio of 8.96, a P/E/G ratio of 1.89 and a beta of 0.76.
The business also recently disclosed a quarterly dividend, which was paid on Friday, December 13th. Stockholders of record on Friday, November 15th were issued a dividend of $0.40 per share. The ex-dividend date was Thursday, November 14th. This represents a $1.60 annualized dividend and a dividend yield of 5.06%. Kraft Heinz’s payout ratio is 45.33%.
Kraft Heinz Company Profile
The Kraft Heinz Company manufactures and markets food and beverage products in the United States, Canada, Europe, and internationally. Its products include condiments and sauces, cheese and dairy products, meals, meats, refreshment beverages, coffee, and other grocery products. 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, Cracker Barrel, P'Tit Cheese, Tassimo, Classico, Plasmon, Pudliszki, Honig, HP, Benedicta, ABC, Master, Quero, Golden Circle, Wattie's, Glucon D, and Complan names.
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