KRAFT HEINZ CO/THE (KHC) Stock Fundamental Analysis
NASDAQ:KHC - Nasdaq - US5007541064 - Common Stock - Currency: USD
KHC gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 89 industry peers in the Food Products industry. While KHC has a great profitability rating, there are quite some concerns on its financial health. KHC is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year KHC was profitable.
In the past year KHC had a positive cash flow from operations.
KHC had positive earnings in each of the past 5 years.
KHC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.94%, KHC is in line with its industry, outperforming 51.69% of the companies in the same industry.
The Return On Equity of KHC (5.37%) is comparable to the rest of the industry.
KHC's Return On Invested Capital of 4.98% is in line compared to the rest of the industry. KHC outperforms 50.56% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for KHC is below the industry average of 9.00%.
The last Return On Invested Capital (4.98%) for KHC is above the 3 year average (4.97%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.94% | ||
| ROE | 5.37% | ||
| ROIC | 4.98% |
ROA(3y)2.96%
ROA(5y)2.06%
ROE(3y)5.4%
ROE(5y)3.79%
ROIC(3y)4.97%
ROIC(5y)4.89%
1.3 Margins
KHC's Profit Margin of 10.44% is amongst the best of the industry. KHC outperforms 85.39% of its industry peers.
In the last couple of years the Profit Margin of KHC has grown nicely.
With an excellent Operating Margin value of 20.76%, KHC belongs to the best of the industry, outperforming 96.63% of the companies in the same industry.
KHC's Operating Margin has been stable in the last couple of years.
KHC has a better Gross Margin (34.58%) than 76.40% of its industry peers.
KHC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.76% | ||
| PM (TTM) | 10.44% | ||
| GM | 34.58% |
OM growth 3Y1.51%
OM growth 5Y0.42%
PM growth 3Y39.8%
PM growth 5Y6.51%
GM growth 3Y1.31%
GM growth 5Y1.14%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so 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 has been reduced compared to 5 years ago.
The debt/assets ratio for KHC is higher compared to a year ago.
2.2 Solvency
KHC has an Altman-Z score of 1.04. This is a bad value and indicates that KHC is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of KHC (1.04) is worse than 70.79% of its industry peers.
KHC has a debt to FCF ratio of 7.14. This is a slightly negative value and a sign of low solvency as KHC would need 7.14 years to pay back of all of its debts.
The Debt to FCF ratio of KHC (7.14) is better than 60.67% of its industry peers.
KHC has a Debt/Equity ratio of 0.42. This is a healthy value indicating a solid balance between debt and equity.
KHC has a Debt to Equity ratio (0.42) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.42 | ||
| Debt/FCF | 7.14 | ||
| Altman-Z | 1.04 |
ROIC/WACC0.72
WACC6.88%
2.3 Liquidity
KHC has a Current Ratio of 1.31. 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 Current ratio of 1.31. This is comparable to the rest of the industry: KHC outperforms 44.94% of its industry peers.
KHC has a Quick Ratio of 1.31. 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 (0.81) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.31 | ||
| Quick Ratio | 0.81 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 0.34% over the past year.
KHC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 1.43% yearly.
KHC shows a decrease in Revenue. In the last year, the revenue decreased by -4.25%.
Measured over the past years, KHC shows a small growth in Revenue. The Revenue has been growing by 0.69% on average per year.
EPS 1Y (TTM)0.34%
EPS 3Y1.34%
EPS 5Y1.43%
EPS Q2Q%-10.14%
Revenue 1Y (TTM)-4.25%
Revenue growth 3Y-0.25%
Revenue growth 5Y0.69%
Sales Q2Q%-6.43%
3.2 Future
Based on estimates for the next years, KHC will show a small growth in Earnings Per Share. The EPS will grow by 2.20% on average per year.
KHC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 0.63% yearly.
EPS Next Y-11.68%
EPS Next 2Y-4.07%
EPS Next 3Y-1.34%
EPS Next 5Y2.2%
Revenue Next Year-3.65%
Revenue Next 2Y-1.39%
Revenue Next 3Y-0.41%
Revenue Next 5Y0.63%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 9.58 indicates a reasonable valuation of KHC.
Based on the Price/Earnings ratio, KHC is valued cheaply inside the industry as 86.52% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 27.75, KHC is valued rather cheaply.
With a Price/Forward Earnings ratio of 10.17, the valuation of KHC can be described as very reasonable.
KHC's Price/Forward Earnings ratio is rather cheap when compared to the industry. KHC is cheaper than 89.89% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 20.49. KHC is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.58 | ||
| Fwd PE | 10.17 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, KHC is valued a bit cheaper than 71.91% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of KHC indicates a somewhat cheap valuation: KHC is cheaper than 77.53% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.2 | ||
| EV/EBITDA | 8.33 |
4.3 Compensation for Growth
KHC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)6.69
EPS Next 2Y-4.07%
EPS Next 3Y-1.34%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.61%, KHC is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 4.38, KHC pays a better dividend. On top of this KHC pays more dividend than 88.76% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.44, KHC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.61% |
5.2 History
KHC has been paying a dividend for at least 10 years, so it has 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)0%
Div Incr Years0
Div Non Decr Years5
5.3 Sustainability
72.39% of the earnings are spent on dividend by KHC. This is not a sustainable payout ratio.
DP72.39%
EPS Next 2Y-4.07%
EPS Next 3Y-1.34%
NASDAQ:KHC (5/2/2025, 9:39:08 AM)
28.63
+0.13 (+0.46%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners59.39%
Inst Owner Change-0.13%
Ins Owners0.26%
Ins Owner Change0.03%
Market Cap33.88B
Analysts55.48
Price Target32.05 (11.95%)
Short Float %4.68%
Short Ratio3.53
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.61% |
Yearly Dividend1.6
Dividend Growth(5Y)0%
DP72.39%
Div Incr Years0
Div Non Decr Years5
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.36%
Min EPS beat(2)1.8%
Max EPS beat(2)6.92%
EPS beat(4)4
Avg EPS beat(4)3.55%
Min EPS beat(4)0.43%
Max EPS beat(4)6.92%
EPS beat(8)7
Avg EPS beat(8)3.21%
EPS beat(12)11
Avg EPS beat(12)4.96%
EPS beat(16)15
Avg EPS beat(16)7.11%
Revenue beat(2)0
Avg Revenue beat(2)-1.82%
Min Revenue beat(2)-2.29%
Max Revenue beat(2)-1.35%
Revenue beat(4)0
Avg Revenue beat(4)-1.83%
Min Revenue beat(4)-2.29%
Max Revenue beat(4)-1.35%
Revenue beat(8)0
Avg Revenue beat(8)-2.1%
Revenue beat(12)4
Avg Revenue beat(12)-0.97%
Revenue beat(16)7
Avg Revenue beat(16)-0.31%
PT rev (1m)-1.79%
PT rev (3m)-14.84%
EPS NQ rev (1m)-0.55%
EPS NQ rev (3m)-13.43%
EPS NY rev (1m)-0.21%
EPS NY rev (3m)-12.82%
Revenue NQ rev (1m)-0.2%
Revenue NQ rev (3m)-5%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-3.78%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.58 | ||
| Fwd PE | 10.17 | ||
| P/S | 1.33 | ||
| P/FCF | 11.2 | ||
| P/OCF | 8.2 | ||
| P/B | 0.69 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.33 |
EPS(TTM)2.99
EY10.44%
EPS(NY)2.82
Fwd EY9.84%
FCF(TTM)2.56
FCFY8.93%
OCF(TTM)3.49
OCFY12.2%
SpS21.49
BVpS41.79
TBVpS-16.43
PEG (NY)N/A
PEG (5Y)6.69
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.94% | ||
| ROE | 5.37% | ||
| ROCE | 6.36% | ||
| ROIC | 4.98% | ||
| ROICexc | 5.15% | ||
| ROICexgc | 36.43% | ||
| OM | 20.76% | ||
| PM (TTM) | 10.44% | ||
| GM | 34.58% | ||
| FCFM | 11.89% |
ROA(3y)2.96%
ROA(5y)2.06%
ROE(3y)5.4%
ROE(5y)3.79%
ROIC(3y)4.97%
ROIC(5y)4.89%
ROICexc(3y)5.05%
ROICexc(5y)5.02%
ROICexgc(3y)48.4%
ROICexgc(5y)52.54%
ROCE(3y)6.35%
ROCE(5y)6.25%
ROICexcg growth 3Y-16.8%
ROICexcg growth 5Y-7.23%
ROICexc growth 3Y1.76%
ROICexc growth 5Y3.9%
OM growth 3Y1.51%
OM growth 5Y0.42%
PM growth 3Y39.8%
PM growth 5Y6.51%
GM growth 3Y1.31%
GM growth 5Y1.14%
F-Score6
Asset Turnover0.28
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.42 | ||
| Debt/FCF | 7.14 | ||
| Debt/EBITDA | 3.36 | ||
| Cap/Depr | 116.75% | ||
| Cap/Sales | 4.36% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 66.36% | ||
| Profit Quality | 113.94% | ||
| Current Ratio | 1.31 | ||
| Quick Ratio | 0.81 | ||
| Altman-Z | 1.04 |
F-Score6
WACC6.88%
ROIC/WACC0.72
Cap/Depr(3y)108.79%
Cap/Depr(5y)97.47%
Cap/Sales(3y)3.92%
Cap/Sales(5y)3.5%
Profit Quality(3y)93.19%
Profit Quality(5y)387.46%
High Growth Momentum
Growth
EPS 1Y (TTM)0.34%
EPS 3Y1.34%
EPS 5Y1.43%
EPS Q2Q%-10.14%
EPS Next Y-11.68%
EPS Next 2Y-4.07%
EPS Next 3Y-1.34%
EPS Next 5Y2.2%
Revenue 1Y (TTM)-4.25%
Revenue growth 3Y-0.25%
Revenue growth 5Y0.69%
Sales Q2Q%-6.43%
Revenue Next Year-3.65%
Revenue Next 2Y-1.39%
Revenue Next 3Y-0.41%
Revenue Next 5Y0.63%
EBIT growth 1Y-0.79%
EBIT growth 3Y1.26%
EBIT growth 5Y1.11%
EBIT Next Year13.63%
EBIT Next 3Y5.59%
EBIT Next 5Y5.49%
FCF growth 1Y101.53%
FCF growth 3Y-12.18%
FCF growth 5Y1.64%
OCF growth 1Y67.4%
OCF growth 3Y-7.95%
OCF growth 5Y3.33%