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Kraft Heinz (KHC) Gains As Market Dips: What You Should Know

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Kraft Heinz (KHC) closed at $37.65 in the latest trading session, marking a +0.94% move from the prior day. This move outpaced the S&P 500's daily loss of 1.42%. At the same time, the Dow lost 0.49%, and the tech-heavy Nasdaq lost 0.47%.

Prior to today's trading, shares of the maker of Oscar Mayer meats, Jell-O pudding and Velveeta cheese had gained 6.94% over the past month. This has outpaced the Consumer Staples sector's gain of 4.57% and the S&P 500's gain of 0.39% in that time.

Investors will be hoping for strength from Kraft Heinz as it approaches its next earnings release. In that report, analysts expect Kraft Heinz to post earnings of $0.63 per share. This would mark a year-over-year decline of 21.25%. Our most recent consensus estimate is calling for quarterly revenue of $6.6 billion, down 4.82% from the year-ago period.

Any recent changes to analyst estimates for Kraft Heinz should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Kraft Heinz is currently a Zacks Rank #4 (Sell).

Digging into valuation, Kraft Heinz currently has a Forward P/E ratio of 14.25. This valuation marks a discount compared to its industry's average Forward P/E of 19.1.

Meanwhile, KHC's PEG ratio is currently 2.85. 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. KHC's industry had an average PEG ratio of 3.18 as of yesterday's close.

The Food - Miscellaneous industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 229, putting it in the bottom 11% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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