KRAFT HEINZ CO/THE (KHC) Stock Fundamental Analysis
NASDAQ:KHC - Nasdaq - US5007541064 - Common Stock
KHC gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 91 industry peers in the Food Products industry. While KHC is still in line with the averages on profitability rating, there are concerns on its financial health. KHC has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
KHC had positive earnings in the past year.
In the past year KHC had a positive cash flow from operations.
Each year in the past 5 years KHC has been profitable.
KHC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of KHC (1.55%) is comparable to the rest of the industry.
KHC's Return On Equity of 2.83% is in line compared to the rest of the industry. KHC outperforms 41.86% of its industry peers.
KHC has a Return On Invested Capital (5.22%) which is in line with its industry peers.
The Average Return On Invested Capital over the past 3 years for KHC is below the industry average of 9.02%.
The last Return On Invested Capital (5.22%) for KHC is above the 3 year average (4.89%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.55% | ||
| ROE | 2.83% | ||
| ROIC | 5.22% |
ROA(3y)2.28%
ROA(5y)1.82%
ROE(3y)4.22%
ROE(5y)3.43%
ROIC(3y)4.89%
ROIC(5y)4.75%
1.3 Margins
KHC has a better Profit Margin (5.24%) than 68.60% of its industry peers.
In the last couple of years the Profit Margin of KHC has grown nicely.
KHC has a Operating Margin of 20.41%. This is amongst the best in the industry. KHC outperforms 95.35% of its industry peers.
In the last couple of years the Operating Margin of KHC has declined.
KHC has a better Gross Margin (34.66%) than 77.91% of its industry peers.
KHC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.41% | ||
| PM (TTM) | 5.24% | ||
| GM | 34.66% |
OM growth 3Y-2.11%
OM growth 5Y-2.9%
PM growth 3Y99.02%
PM growth 5YN/A
GM growth 3Y-1.21%
GM growth 5Y-0.58%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), KHC is destroying value.
The number of shares outstanding for KHC has been reduced compared to 1 year ago.
The number of shares outstanding for KHC remains at a similar level compared to 5 years ago.
KHC has about the same debt/assets ratio as last year.
2.2 Solvency
Based on the Altman-Z score of 1.04, we must say that KHC is in the distress zone and has some risk of bankruptcy.
KHC has a Altman-Z score of 1.04. This is in the lower half of the industry: KHC underperforms 75.58% of its industry peers.
KHC has a debt to FCF ratio of 6.69. This is a slightly negative value and a sign of low solvency as KHC would need 6.69 years to pay back of all of its debts.
The Debt to FCF ratio of KHC (6.69) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.40 indicates that KHC is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.40, KHC is in line with its industry, outperforming 53.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.4 | ||
| Debt/FCF | 6.69 | ||
| Altman-Z | 1.04 |
ROIC/WACC0.73
WACC7.19%
2.3 Liquidity
KHC has a Current Ratio of 1.06. This is a normal value and indicates that KHC is financially healthy and should not expect problems in meeting its short term obligations.
KHC has a worse Current ratio (1.06) than 74.42% of its industry peers.
KHC has a Quick Ratio of 1.06. This is a bad value and indicates that KHC is not financially healthy enough and could expect problems in meeting its short term obligations.
KHC has a Quick ratio of 0.56. This is in the lower half of the industry: KHC underperforms 70.93% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.06 | ||
| Quick Ratio | 0.56 |
3. Growth
3.1 Past
KHC shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -1.32%.
The Earnings Per Share has been decreasing by -3.29% on average over the past years.
KHC shows a decrease in Revenue. In the last year, the revenue decreased by -3.80%.
The Revenue has been growing slightly by 0.28% on average over the past years.
EPS 1Y (TTM)-1.32%
EPS 3Y1.03%
EPS 5Y-3.29%
EPS Q2Q%4.17%
Revenue 1Y (TTM)-3.8%
Revenue growth 3Y0.58%
Revenue growth 5Y0.28%
Sales Q2Q%-2.85%
3.2 Future
KHC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 4.50% yearly.
Based on estimates for the next years, KHC will show a small growth in Revenue. The Revenue will grow by 0.76% on average per year.
EPS Next Y2.22%
EPS Next 2Y2.17%
EPS Next 3Y3.18%
EPS Next 5Y4.5%
Revenue Next Year-2.92%
Revenue Next 2Y-1.32%
Revenue Next 3Y-0.27%
Revenue Next 5Y0.76%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 9.83, the valuation of KHC can be described as very reasonable.
Based on the Price/Earnings ratio, KHC is valued cheaper than 86.05% of the companies in the same industry.
When comparing the Price/Earnings ratio of KHC to the average of the S&P500 Index (28.29), we can say KHC is valued rather cheaply.
With a Price/Forward Earnings ratio of 9.51, the valuation of KHC can be described as very reasonable.
Based on the Price/Forward Earnings ratio, KHC is valued cheaper than 91.86% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.44, KHC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.83 | ||
| Fwd PE | 9.51 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, KHC is valued a bit cheaper than the industry average as 70.93% of the companies are valued more expensively.
KHC's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. KHC is cheaper than 74.42% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.88 | ||
| EV/EBITDA | 8.65 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates KHC does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of KHC may justify a higher PE ratio.
PEG (NY)4.42
PEG (5Y)N/A
EPS Next 2Y2.17%
EPS Next 3Y3.18%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.52%, KHC is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.86, KHC pays a better dividend. On top of this KHC pays more dividend than 91.86% of the companies listed in the same industry.
KHC's Dividend Yield is rather good when compared to the S&P500 average which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.52% |
5.2 History
The dividend of KHC decreases each year by -9.23%.
KHC has paid a dividend for at least 10 years, which is a reliable track record.
KHC has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)-9.23%
Div Incr Years0
Div Non Decr Years5
5.3 Sustainability
KHC pays out 141.82% of its income as dividend. This is not a sustainable payout ratio.
DP141.82%
EPS Next 2Y2.17%
EPS Next 3Y3.18%
KRAFT HEINZ CO/THE
NASDAQ:KHC (1/21/2025, 8:10:40 PM)
Premarket: 29.47 -0.01 (-0.03%)29.48
+0.21 (+0.72%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners56.7%
Inst Owner Change0.16%
Ins Owners0.26%
Ins Owner Change-0.01%
Market Cap35.65B
Analysts71.85
Price Target37.64 (27.68%)
Short Float %4.28%
Short Ratio3.58
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.52% |
Yearly Dividend1.61
Dividend Growth(5Y)-9.23%
DP141.82%
Div Incr Years0
Div Non Decr Years5
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.75%
Min EPS beat(2)0.43%
Max EPS beat(2)5.06%
EPS beat(4)3
Avg EPS beat(4)1.4%
Min EPS beat(4)-0.52%
Max EPS beat(4)5.06%
EPS beat(8)7
Avg EPS beat(8)4.72%
EPS beat(12)11
Avg EPS beat(12)7.23%
EPS beat(16)15
Avg EPS beat(16)8.29%
Revenue beat(2)0
Avg Revenue beat(2)-1.84%
Min Revenue beat(2)-2.16%
Max Revenue beat(2)-1.53%
Revenue beat(4)0
Avg Revenue beat(4)-1.93%
Min Revenue beat(4)-2.76%
Max Revenue beat(4)-1.26%
Revenue beat(8)2
Avg Revenue beat(8)-1.53%
Revenue beat(12)6
Avg Revenue beat(12)-0.4%
Revenue beat(16)9
Avg Revenue beat(16)0.05%
PT rev (1m)-0.39%
PT rev (3m)-4.54%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-6.2%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.6%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-4.51%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.8%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.83 | ||
| Fwd PE | 9.51 | ||
| P/S | 1.36 | ||
| P/FCF | 11.88 | ||
| P/OCF | 8.59 | ||
| P/B | 0.74 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.65 |
EPS(TTM)3
EY10.18%
EPS(NY)3.1
Fwd EY10.52%
FCF(TTM)2.48
FCFY8.42%
OCF(TTM)3.43
OCFY11.65%
SpS21.61
BVpS39.97
TBVpS-18.54
PEG (NY)4.42
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.55% | ||
| ROE | 2.83% | ||
| ROCE | 6.6% | ||
| ROIC | 5.22% | ||
| ROICexc | 5.3% | ||
| ROICexgc | 47.82% | ||
| OM | 20.41% | ||
| PM (TTM) | 5.24% | ||
| GM | 34.66% | ||
| FCFM | 11.48% |
ROA(3y)2.28%
ROA(5y)1.82%
ROE(3y)4.22%
ROE(5y)3.43%
ROIC(3y)4.89%
ROIC(5y)4.75%
ROICexc(3y)5.01%
ROICexc(5y)4.88%
ROICexgc(3y)58.42%
ROICexgc(5y)56.59%
ROCE(3y)6.19%
ROCE(5y)6.01%
ROICexcg growth 3Y0.88%
ROICexcg growth 5Y-0.57%
ROICexc growth 3Y1.39%
ROICexc growth 5Y0.52%
OM growth 3Y-2.11%
OM growth 5Y-2.9%
PM growth 3Y99.02%
PM growth 5YN/A
GM growth 3Y-1.21%
GM growth 5Y-0.58%
F-Score5
Asset Turnover0.3
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.4 | ||
| Debt/FCF | 6.69 | ||
| Debt/EBITDA | 3.08 | ||
| Cap/Depr | 119.28% | ||
| Cap/Sales | 4.4% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 65.94% | ||
| Profit Quality | 219.05% | ||
| Current Ratio | 1.06 | ||
| Quick Ratio | 0.56 | ||
| Altman-Z | 1.04 |
F-Score5
WACC7.19%
ROIC/WACC0.73
Cap/Depr(3y)101.01%
Cap/Depr(5y)88.36%
Cap/Sales(3y)3.58%
Cap/Sales(5y)3.22%
Profit Quality(3y)203.37%
Profit Quality(5y)394.23%
High Growth Momentum
Growth
EPS 1Y (TTM)-1.32%
EPS 3Y1.03%
EPS 5Y-3.29%
EPS Q2Q%4.17%
EPS Next Y2.22%
EPS Next 2Y2.17%
EPS Next 3Y3.18%
EPS Next 5Y4.5%
Revenue 1Y (TTM)-3.8%
Revenue growth 3Y0.58%
Revenue growth 5Y0.28%
Sales Q2Q%-2.85%
Revenue Next Year-2.92%
Revenue Next 2Y-1.32%
Revenue Next 3Y-0.27%
Revenue Next 5Y0.76%
EBIT growth 1Y3.21%
EBIT growth 3Y-1.55%
EBIT growth 5Y-2.63%
EBIT Next Year22.71%
EBIT Next 3Y8.21%
EBIT Next 5Y6.79%
FCF growth 1Y-15.49%
FCF growth 3Y-11.9%
FCF growth 5Y11.13%
OCF growth 1Y-6.34%
OCF growth 3Y-6.91%
OCF growth 5Y9.09%