Kraft Heinz's Stock Is as Cheap as It's Been Since 2020. 1 Thing to Know Before You Buy.
I've been following the Kraft Heinz (NASDAQ: KHC) story since 2013, when Warren Buffett teamed up with 3G Capital to take H.J. Heinz private. Two years later, they merged the entity with Kraft Foods to create Kraft Heinz. At the time, it looked like a brilliant move, streamlining two blue chip companies with incredible scale and brand power.But since 2017, shares have fallen nearly 70% in value. According to many valuation metrics, Kraft Heinz stock is a bargain right now. It's rare to buy such a well-known, high-quality business at such a discount. But before you jump in, there's one thing you need to understand.Kraft Heinz is a combination of two iconic businesses. But that doesn't mean the company is growing. Revenue growth in recent years has been a challenge, fueled by lackluster consumer demand stemming from inflation, increased competition due to direct-to-consumer start-up brands, and private label competition within stores. Put simply, people aren't as willing or able to spend their dollars on the premium branded products that dominate Kraft Heinz's lineup. Continue reading
I've been following the Kraft Heinz (NASDAQ: KHC) story since 2013, when Warren Buffett teamed up with 3G Capital to take H.J. Heinz private. Two years later, they merged the entity with Kraft Foods to create Kraft Heinz. At the time, it looked like a brilliant move, streamlining two blue chip companies with incredible scale and brand power.
But since 2017, shares have fallen nearly 70% in value. According to many valuation metrics, Kraft Heinz stock is a bargain right now. It's rare to buy such a well-known, high-quality business at such a discount. But before you jump in, there's one thing you need to understand.
Kraft Heinz is a combination of two iconic businesses. But that doesn't mean the company is growing. Revenue growth in recent years has been a challenge, fueled by lackluster consumer demand stemming from inflation, increased competition due to direct-to-consumer start-up brands, and private label competition within stores. Put simply, people aren't as willing or able to spend their dollars on the premium branded products that dominate Kraft Heinz's lineup.
