Buffett Admits Mistake in Kraft Heinz Investment
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 23 2026
0mins
Source: Fool
- Mistake Acknowledgment: Buffett admitted in 2019 that Berkshire Hathaway overpaid for Kraft Heinz, resulting in a prolonged decline in stock price, highlighting his reflective approach to investment decisions.
- Sale Plan Paused: Although Berkshire planned to sell its stake in Kraft Heinz in January 2026, the sale was halted after the company announced a $600 million investment in a turnaround effort, indicating short-term confidence in the company's future.
- Declining Revenue Trend: Kraft Heinz's revenue fell from $26.6 billion in 2023 to $24.9 billion in 2025, reflecting significant pressure from changing consumer preferences and the
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Analyst Views on KHC
Wall Street analysts forecast KHC stock price to rise
15 Analyst Rating
0 Buy
14 Hold
1 Sell
Hold
Current: 24.010
Low
24.00
Averages
25.86
High
28.00
Current: 24.010
Low
24.00
Averages
25.86
High
28.00
About KHC
The Kraft Heinz Company manufactures and markets food and beverage products around the world through its eight consumer-driven product platforms: Taste Elevation, Easy Ready Meals, Substantial Snacking, Desserts, Hydration, Cheese, Coffee, Meats, and other grocery products. The Company has two reportable segments defined by geographic region: North America and International Developed Markets. Its other segments, consisting of West and East Emerging Markets (WEEM) and Asia Emerging Markets (AEM), are combined and disclosed as Emerging Markets. It manufactures its products from a wide variety of raw materials. Its brands include Kraft, Oscar Mayer, Heinz, Philadelphia, Lunchables, Velveeta, Ore-Ida, Capri Sun, Maxwell Apartment, Kool-Aid, Jell-O, Heinz, Golden Circle, Wattie's, Plasmon, Heinz, ABC, Master, Quero, Kraft, and Pudliszki, among others. The Company's products are sold through its own sales organizations and through independent brokers, agents, and distributors.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Valuation Analysis of U.S. Consumer Staples Stocks
- Valuation Overview: Kraft Heinz (KHC), General Mills (GIS), and Clorox (CLX) are identified as the most attractively valued consumer staples stocks, indicating their undervaluation relative to peers in the market.
- Valuation Metrics Analysis: The valuation grades incorporate multiple metrics, including P/E, PEG, price-to-sales, and price-to-cash-flow ratios, using both current and forward-looking estimates, providing crucial insights for investors' decision-making.
- Market Performance Comparison: Among companies with a market cap above $10 billion, Kraft Heinz leads with an A+ rating, followed by General Mills and Clorox with A and A- ratings respectively, highlighting their strong investment appeal in the current market environment.
- Industry Dynamics Impact: Despite the overall positive market performance, Heinz experienced a pullback after six consecutive days of gains, reflecting cautious market sentiment regarding its future performance and underscoring the volatility within the consumer staples sector.
See More
Kraft Heinz Shares Dip After Six-Day Rally Amid Market Share Concerns
- Stock Price Decline: Shares of Kraft Heinz Company (KHC) fell 1.08% to $24.21 on Friday, ending a six-day winning streak, indicating market concerns regarding its future performance amidst ongoing challenges.
- Cash Tender Offer Progress: The company is executing a cash tender offer of up to $1.1 billion, having announced pricing terms and accepted tender amounts, which demonstrates proactive debt management aimed at improving financial health and boosting investor confidence.
- Market Share Pressure: Despite a 7.6% increase in stock price over the past month, analysts highlight that KHC has been losing market share in the U.S., indicating significant competitive pressures that necessitate effective strategies for achieving stable growth.
- Cautious Analyst Ratings: On Wall Street, only 1 out of 20 analysts rates KHC as a buy, with 15 suggesting hold and 4 recommending sell, reflecting a cautious outlook on the company's growth potential in the current market environment.
See More
Wall Street Rises with Strong Tech Stock Performance
- Strong Market Rally: Futures indicate an up day for Wall Street as the S&P 500 and Nasdaq hit record highs, driven by AI-related stocks like Micron, which surged 19% and surpassed a $1 trillion market cap, reflecting robust demand for AI chips.
- Micron's Continued Ascent: Micron's stock rose another 7% in premarket trading, achieving a remarkable increase from $500 billion to $1 trillion in just 48 days, the fastest on record, highlighting the ongoing shortage and insatiable demand for memory chips, suggesting significant future growth potential.
- SK Hynix Joins the $1 Trillion Club: South Korean memory giant SK Hynix also crossed the $1 trillion market cap threshold in today's trading, underscoring the strong growth in the global memory market and the increasing demand driven by the AI era.
- Upgrades for FedEx and Danaher: JPMorgan upgraded FedEx from hold to buy with a price target raised to $460, citing attractive risk/reward ahead of its freight unit separation; meanwhile, Citi reinstated Danaher with a buy rating and a $230 price target, reflecting optimism in the bioprocessing sector.
See More
Berkshire's New CEO Adjusts Investment Portfolio
- Airline Investment: Berkshire Hathaway's acquisition of approximately 40 million shares of Delta Air Lines in Q1 is notable, as Buffett historically criticized airlines; this move suggests new CEO Greg Abel may adopt a more flexible investment strategy despite rising oil prices and economic uncertainties potentially impacting travel demand.
- Tech Stock Increase: Berkshire has tripled its stake in Alphabet to nearly 7%, making it one of its top five holdings, indicating a greater acceptance of tech investments, particularly in artificial intelligence, even as Alphabet trades at a high price-to-earnings ratio of 29, reflecting its elevated valuation.
- Retention of Kraft Heinz: Contrary to speculation that Berkshire would exit its position in Kraft Heinz, the company chose to maintain its investment, signaling confidence in the brand despite a 46% decline in stock price over the past five years, which raises concerns about investment risk.
- Strategic Shift Indication: With Berkshire's stock down 4% this year, the new CEO's investment decisions suggest a willingness to pay higher prices for stocks, indicating a strategic shift that may appeal to long-term investors looking for diversification opportunities.
See More
Berkshire's New CEO Adjusts Investment Portfolio
- Portfolio Changes: In Q1 2026, following the leadership transition to Greg Abel, Berkshire Hathaway made significant investments in tech and airline sectors, notably acquiring around 40 million shares of Delta Air Lines, despite challenges from rising oil prices and declining travel demand.
- Increased Tech Holdings: Berkshire has raised its stake in Alphabet to nearly 7%, surpassing Chevron and Occidental Petroleum, indicating a greater acceptance of tech investments, even as Alphabet trades at a high price-to-earnings ratio of 29, reflecting its elevated valuation.
- Retention of Kraft Heinz: Contrary to speculation that Berkshire would exit its position in Kraft Heinz, the company opted to retain this underperforming stock, suggesting a long-term investment confidence despite Kraft's stock plummeting 46% over the past five years.
- Signal of Strategic Shift: The investment decisions made by Berkshire this quarter indicate a potential shift in strategy, where the company may be more willing to pay higher prices for stocks and explore new opportunities, even as its stock has declined 4% this year amid the reality of Buffett's absence.
See More
Kraft Heinz Company Announces Cash Tender Offer Terms
- Tender Offer Amount: Kraft Heinz Company, through its wholly-owned subsidiary, announced a cash tender offer to purchase up to $1.1 billion of its 4.375% and 4.875% Senior Notes, aiming to optimize its capital structure and reduce financing costs.
- 2046 Notes Acceptance: As of the Early Tender Time on May 20, 2026, valid tenders for the 2046 Notes totaled $1.379 billion, exceeding the maximum tender amount, with approximately 49.51% of the notes accepted, indicating strong market demand for this debt instrument.
- Early Settlement Date: The accepted 2046 Notes will settle on May 26, 2026, which enhances liquidity and meets investor cash flow needs while reflecting the company's focus on effective debt management.
- Underwriter Participation: Kraft Heinz has engaged several major financial institutions as dealer managers to facilitate the tender offer, further bolstering market confidence in its financial stability.
See More
Valuation Analysis of U.S. Consumer Staples Stocks
- Valuation Overview: Kraft Heinz (KHC), General Mills (GIS), and Clorox (CLX) are identified as the most attractively valued consumer staples stocks, indicating their undervaluation relative to peers in the market.
- Valuation Metrics Analysis: The valuation grades incorporate multiple metrics, including P/E, PEG, price-to-sales, and price-to-cash-flow ratios, using both current and forward-looking estimates, providing crucial insights for investors' decision-making.
- Market Performance Comparison: Among companies with a market cap above $10 billion, Kraft Heinz leads with an A+ rating, followed by General Mills and Clorox with A and A- ratings respectively, highlighting their strong investment appeal in the current market environment.
- Industry Dynamics Impact: Despite the overall positive market performance, Heinz experienced a pullback after six consecutive days of gains, reflecting cautious market sentiment regarding its future performance and underscoring the volatility within the consumer staples sector.
See More
Kraft Heinz Shares Dip After Six-Day Rally Amid Market Share Concerns
- Stock Price Decline: Shares of Kraft Heinz Company (KHC) fell 1.08% to $24.21 on Friday, ending a six-day winning streak, indicating market concerns regarding its future performance amidst ongoing challenges.
- Cash Tender Offer Progress: The company is executing a cash tender offer of up to $1.1 billion, having announced pricing terms and accepted tender amounts, which demonstrates proactive debt management aimed at improving financial health and boosting investor confidence.
- Market Share Pressure: Despite a 7.6% increase in stock price over the past month, analysts highlight that KHC has been losing market share in the U.S., indicating significant competitive pressures that necessitate effective strategies for achieving stable growth.
- Cautious Analyst Ratings: On Wall Street, only 1 out of 20 analysts rates KHC as a buy, with 15 suggesting hold and 4 recommending sell, reflecting a cautious outlook on the company's growth potential in the current market environment.
See More
Wall Street Rises with Strong Tech Stock Performance
- Strong Market Rally: Futures indicate an up day for Wall Street as the S&P 500 and Nasdaq hit record highs, driven by AI-related stocks like Micron, which surged 19% and surpassed a $1 trillion market cap, reflecting robust demand for AI chips.
- Micron's Continued Ascent: Micron's stock rose another 7% in premarket trading, achieving a remarkable increase from $500 billion to $1 trillion in just 48 days, the fastest on record, highlighting the ongoing shortage and insatiable demand for memory chips, suggesting significant future growth potential.
- SK Hynix Joins the $1 Trillion Club: South Korean memory giant SK Hynix also crossed the $1 trillion market cap threshold in today's trading, underscoring the strong growth in the global memory market and the increasing demand driven by the AI era.
- Upgrades for FedEx and Danaher: JPMorgan upgraded FedEx from hold to buy with a price target raised to $460, citing attractive risk/reward ahead of its freight unit separation; meanwhile, Citi reinstated Danaher with a buy rating and a $230 price target, reflecting optimism in the bioprocessing sector.
See More
Berkshire's New CEO Adjusts Investment Portfolio
- Airline Investment: Berkshire Hathaway's acquisition of approximately 40 million shares of Delta Air Lines in Q1 is notable, as Buffett historically criticized airlines; this move suggests new CEO Greg Abel may adopt a more flexible investment strategy despite rising oil prices and economic uncertainties potentially impacting travel demand.
- Tech Stock Increase: Berkshire has tripled its stake in Alphabet to nearly 7%, making it one of its top five holdings, indicating a greater acceptance of tech investments, particularly in artificial intelligence, even as Alphabet trades at a high price-to-earnings ratio of 29, reflecting its elevated valuation.
- Retention of Kraft Heinz: Contrary to speculation that Berkshire would exit its position in Kraft Heinz, the company chose to maintain its investment, signaling confidence in the brand despite a 46% decline in stock price over the past five years, which raises concerns about investment risk.
- Strategic Shift Indication: With Berkshire's stock down 4% this year, the new CEO's investment decisions suggest a willingness to pay higher prices for stocks, indicating a strategic shift that may appeal to long-term investors looking for diversification opportunities.
See More
Berkshire's New CEO Adjusts Investment Portfolio
- Portfolio Changes: In Q1 2026, following the leadership transition to Greg Abel, Berkshire Hathaway made significant investments in tech and airline sectors, notably acquiring around 40 million shares of Delta Air Lines, despite challenges from rising oil prices and declining travel demand.
- Increased Tech Holdings: Berkshire has raised its stake in Alphabet to nearly 7%, surpassing Chevron and Occidental Petroleum, indicating a greater acceptance of tech investments, even as Alphabet trades at a high price-to-earnings ratio of 29, reflecting its elevated valuation.
- Retention of Kraft Heinz: Contrary to speculation that Berkshire would exit its position in Kraft Heinz, the company opted to retain this underperforming stock, suggesting a long-term investment confidence despite Kraft's stock plummeting 46% over the past five years.
- Signal of Strategic Shift: The investment decisions made by Berkshire this quarter indicate a potential shift in strategy, where the company may be more willing to pay higher prices for stocks and explore new opportunities, even as its stock has declined 4% this year amid the reality of Buffett's absence.
See More
Kraft Heinz Company Announces Cash Tender Offer Terms
- Tender Offer Amount: Kraft Heinz Company, through its wholly-owned subsidiary, announced a cash tender offer to purchase up to $1.1 billion of its 4.375% and 4.875% Senior Notes, aiming to optimize its capital structure and reduce financing costs.
- 2046 Notes Acceptance: As of the Early Tender Time on May 20, 2026, valid tenders for the 2046 Notes totaled $1.379 billion, exceeding the maximum tender amount, with approximately 49.51% of the notes accepted, indicating strong market demand for this debt instrument.
- Early Settlement Date: The accepted 2046 Notes will settle on May 26, 2026, which enhances liquidity and meets investor cash flow needs while reflecting the company's focus on effective debt management.
- Underwriter Participation: Kraft Heinz has engaged several major financial institutions as dealer managers to facilitate the tender offer, further bolstering market confidence in its financial stability.
See More
