KRAFT HEINZ CO/THE (KHC) Stock Fundamental Analysis
NASDAQ:KHC - US5007541064 - Common Stock
28.06 USD
+0.56 (+2.04%)
28.0594 USD
0 (0%)
Taking everything into account, KHC scores 5 out of 10 in our fundamental rating. KHC was compared to 89 industry peers in the Food Products industry. There are concerns on the financial health of KHC while its profitability can be described as average. KHC has a bad growth rate and is valued cheaply.
1. Profitability
1.1 Basic Checks
In the past year KHC was profitable.
KHC had a positive operating cash flow in the past year.
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
KHC's Return On Assets of -6.46% is on the low side compared to the rest of the industry. KHC is outperformed by 69.66% of its industry peers.
The Return On Equity of KHC (-12.74%) is worse than 68.54% of its industry peers.
KHC's Return On Invested Capital of 5.58% is fine compared to the rest of the industry. KHC outperforms 61.80% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for KHC is significantly below the industry average of 29.14%.
The 3 year average ROIC (4.97%) for KHC is below the current ROIC(5.58%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -6.46% | ||
| ROE | -12.74% | ||
| ROIC | 5.58% |
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
In the last couple of years the Profit Margin of KHC has grown nicely.
KHC's Operating Margin of 20.52% is amongst the best of the industry. KHC outperforms 97.75% of its industry peers.
In the last couple of years the Operating Margin of KHC has remained more or less at the same level.
Looking at the Gross Margin, with a value of 34.31%, KHC is in the better half of the industry, outperforming 75.28% of the companies in the same industry.
KHC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.52% | ||
| PM (TTM) | N/A | ||
| GM | 34.31% |
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
KHC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, KHC has less shares outstanding
The number of shares outstanding for KHC has been reduced compared to 5 years ago.
KHC has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 0.91, we must say that KHC is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 0.91, KHC is doing worse than 73.03% of the companies in the same industry.
The Debt to FCF ratio of KHC is 6.07, which is on the high side as it means it would take KHC, 6.07 years of fcf income to pay off all of its debts.
KHC has a better Debt to FCF ratio (6.07) than 77.53% of its industry peers.
KHC has a Debt/Equity ratio of 0.47. This is a healthy value indicating a solid balance between debt and equity.
KHC has a Debt to Equity ratio (0.47) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 6.07 | ||
| Altman-Z | 0.91 |
ROIC/WACC0.8
WACC6.94%
2.3 Liquidity
KHC has a Current Ratio of 1.07. This is a normal value and indicates that KHC is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of KHC (1.07) is worse than 69.66% of its industry peers.
A Quick Ratio of 0.66 indicates that KHC may have some problems paying its short term obligations.
KHC has a Quick ratio of 0.66. This is in the lower half of the industry: KHC underperforms 68.54% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.07 | ||
| Quick Ratio | 0.66 |
3. Growth
3.1 Past
The earnings per share for KHC have decreased by -2.36% in the last 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 -3.83%.
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)-2.36%
EPS 3Y1.34%
EPS 5Y1.43%
EPS Q2Q%-11.54%
Revenue 1Y (TTM)-3.83%
Revenue growth 3Y-0.25%
Revenue growth 5Y0.69%
Sales Q2Q%-1.91%
3.2 Future
The Earnings Per Share is expected to grow by 1.71% on average over the next years.
The Revenue is expected to grow by 0.45% on average over the next years.
EPS Next Y-14.59%
EPS Next 2Y-6.3%
EPS Next 3Y-2.61%
EPS Next 5Y1.71%
Revenue Next Year-3.67%
Revenue Next 2Y-1.46%
Revenue Next 3Y-0.48%
Revenue Next 5Y0.45%
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 stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 9.68, the valuation of KHC can be described as very reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of KHC indicates a rather cheap valuation: KHC is cheaper than 83.15% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of KHC to the average of the S&P500 Index (27.24), we can say KHC is valued rather cheaply.
A Price/Forward Earnings ratio of 10.45 indicates a reasonable valuation of KHC.
Compared to the rest of the industry, the Price/Forward Earnings ratio of KHC indicates a rather cheap valuation: KHC is cheaper than 87.64% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 35.82. KHC is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.68 | ||
| Fwd PE | 10.45 |
4.2 Price Multiples
70.79% of the companies in the same industry are more expensive than KHC, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, KHC is valued cheaper than 87.64% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.5 | ||
| EV/EBITDA | 8.17 |
4.3 Compensation for Growth
KHC has a very decent profitability rating, which may justify a higher PE ratio.
A cheap valuation may be justified as KHC's earnings are expected to decrease with -2.61% in the coming years.
PEG (NY)N/A
PEG (5Y)6.76
EPS Next 2Y-6.3%
EPS Next 3Y-2.61%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.79%, KHC is a good candidate for dividend investing.
KHC's Dividend Yield is rather good when compared to the industry average which is at 4.55. KHC pays more dividend than 87.64% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, KHC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.79% |
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
KHC has negative earnings and hence a negative payout ratio. The dividend may be in danger.
DP-36.29%
EPS Next 2Y-6.3%
EPS Next 3Y-2.61%
28.06
+0.56 (+2.04%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners59.62%
Inst Owner Change0.19%
Ins Owners0.28%
Ins Owner Change0.06%
Market Cap33.21B
Analysts56.67
Price Target31.31 (11.58%)
Short Float %5.73%
Short Ratio3.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.79% |
Yearly Dividend1.6
Dividend Growth(5Y)0%
DP-36.29%
Div Incr Years0
Div Non Decr Years5
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.65%
Min EPS beat(2)1.8%
Max EPS beat(2)7.5%
EPS beat(4)4
Avg EPS beat(4)4.16%
Min EPS beat(4)0.43%
Max EPS beat(4)7.5%
EPS beat(8)7
Avg EPS beat(8)3.78%
EPS beat(12)11
Avg EPS beat(12)5.46%
EPS beat(16)15
Avg EPS beat(16)7.14%
Revenue beat(2)1
Avg Revenue beat(2)-0.4%
Min Revenue beat(2)-1.28%
Max Revenue beat(2)0.47%
Revenue beat(4)1
Avg Revenue beat(4)-1.16%
Min Revenue beat(4)-2.29%
Max Revenue beat(4)0.47%
Revenue beat(8)1
Avg Revenue beat(8)-1.74%
Revenue beat(12)4
Avg Revenue beat(12)-1.05%
Revenue beat(16)8
Avg Revenue beat(16)-0.27%
PT rev (1m)0.85%
PT rev (3m)0.03%
EPS NQ rev (1m)-7.25%
EPS NQ rev (3m)-11.37%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.04%
Revenue NQ rev (1m)1.15%
Revenue NQ rev (3m)1.13%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.68 | ||
| Fwd PE | 10.45 | ||
| P/S | 1.31 | ||
| P/FCF | 9.5 | ||
| P/OCF | 7.55 | ||
| P/B | 0.8 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.17 |
EPS(TTM)2.9
EY10.33%
EPS(NY)2.69
Fwd EY9.57%
FCF(TTM)2.95
FCFY10.52%
OCF(TTM)3.72
OCFY13.25%
SpS21.38
BVpS34.94
TBVpS-15.76
PEG (NY)N/A
PEG (5Y)6.76
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -6.46% | ||
| ROE | -12.74% | ||
| ROCE | 7.12% | ||
| ROIC | 5.58% | ||
| ROICexc | 5.78% | ||
| ROICexgc | 39.17% | ||
| OM | 20.52% | ||
| PM (TTM) | N/A | ||
| GM | 34.31% | ||
| FCFM | 13.8% |
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-Score5
Asset Turnover0.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 6.07 | ||
| Debt/EBITDA | 3.14 | ||
| Cap/Depr | 95.27% | ||
| Cap/Sales | 3.58% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 71.61% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.07 | ||
| Quick Ratio | 0.66 | ||
| Altman-Z | 0.91 |
F-Score5
WACC6.94%
ROIC/WACC0.8
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)-2.36%
EPS 3Y1.34%
EPS 5Y1.43%
EPS Q2Q%-11.54%
EPS Next Y-14.59%
EPS Next 2Y-6.3%
EPS Next 3Y-2.61%
EPS Next 5Y1.71%
Revenue 1Y (TTM)-3.83%
Revenue growth 3Y-0.25%
Revenue growth 5Y0.69%
Sales Q2Q%-1.91%
Revenue Next Year-3.67%
Revenue Next 2Y-1.46%
Revenue Next 3Y-0.48%
Revenue Next 5Y0.45%
EBIT growth 1Y-2.9%
EBIT growth 3Y1.26%
EBIT growth 5Y1.11%
EBIT Next Year10.04%
EBIT Next 3Y4.36%
EBIT Next 5Y5.07%
FCF growth 1Y53.51%
FCF growth 3Y-12.18%
FCF growth 5Y1.64%
OCF growth 1Y34.76%
OCF growth 3Y-7.95%
OCF growth 5Y3.33%