Spotlight on Kraft Heinz as asset sales loom and Berkshire’s commitment is tested
Written by Emily J. Thompson, Senior Investment Analyst
Updated: May 21 2025
0mins
Should l Buy KHC?
Source: SeekingAlpha
Kraft Heinz Strategic Review: Kraft Heinz is evaluating strategic transactions to enhance shareholder value, while Berkshire Hathaway will no longer hold board seats but retains a 27.5% stake in the company, potentially signaling future share sales.
Analyst Insights on Portfolio Changes: Analysts from Bank of America and Wells Fargo suggest that about one-third of Kraft Heinz's portfolio may be reviewed for potential asset sales, with indications that the company is restructuring its assets and seeking deals for less core brands like Oscar Mayer.
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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: 24.990
Low
24.00
Averages
25.86
High
28.00
Current: 24.990
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, and Meats. 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.
Kraft Heinz Maintains Single Entity Strategy Amid Downgrade
- Lackluster Outlook: Kraft Heinz (KHC) faced a downgrade to Underweight by J.P. Morgan analysts following its Q4 results, indicating ongoing challenges that may limit expected volume growth as 2026 approaches.
- Declining Volumes: Despite investments in innovation and marketing, KHC has experienced over a 3% decline in North American volumes for 19 consecutive quarters, highlighting persistent market share losses and weak category performance.
- Market Share Losses: Nielsen data reveals that KHC is losing volume share in 10 out of its 13 largest U.S. retail categories, including packaged lunch meat, underscoring increasing competitive pressures.
- Delayed ROI on Investments: While KHC anticipates that increased marketing investments will boost sales in Q2 and beyond, analysts express skepticism about the speed of this transformation, suggesting that the 2026 outlook may be overly conservative.
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Market Dynamics and Investment Opportunities Analysis
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- Cisco's Decline: Despite reporting strong quarterly results and raising its annual outlook, Cisco's stock fell about 7% in pre-market trading due to high memory prices squeezing gross margins, highlighting market concerns over its future profitability, prompting us to trim our position ahead of the report to mitigate risk.
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- Shopify Attractiveness Upgrade: TD Cowen upgrades Shopify from hold to buy, citing its strong quarterly performance and continued growth momentum as compelling reasons for investors to consider the stock, especially given its recent price decline.
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JPMorgan Downgrades Kraft Heinz Amid Challenges
- Rating Downgrade: JPMorgan downgraded Kraft Heinz from neutral to underweight, with analyst Thomas Palmer lowering the price target from $24 to $22, indicating a potential downside of 12% and reflecting market concerns about the company's outlook.
- Poor Performance: Although Kraft Heinz reported a fourth-quarter earnings beat, its earnings per share and organic sales growth outlook for 2026 fell below consensus estimates, indicating the company failed to meet Wall Street's revenue expectations.
- Investment Plans: The company announced a $600 million investment aimed at turning around its U.S. business, with funds allocated to marketing, sales, and R&D, demonstrating a commitment to future growth, although these investments may take time to yield results.
- Ongoing Challenges: Kraft Heinz faces broad-based volume challenges in the U.S., with a 3% year-over-year decline for 19 consecutive quarters, attributed to market share losses and weak category performance, while the pause on its breakup plan further limits the company's financial flexibility.
See More
The Job Market Appears Robust, Yet These Red Flags Indicate AI's Rising Risk.
Job Market Overview: The recent jobs report appears strong, but there are underlying concerns regarding the impact of artificial intelligence on employment.
Sector Vulnerability: Certain professions, like software development, may be more at risk from AI advancements compared to others, such as nursing.
See More
US Jobs Report Exceeds Expectations, Stocks Little Changed
- Strong Job Data: The US economy added 130,000 jobs in January, with the unemployment rate slightly decreasing to 4.3%, indicating resilience in the labor market; however, the 2025 payroll growth was heavily revised down from 584,000 to 181,000, highlighting potential economic slowdown risks.
- Cautious Market Reaction: The Dow Jones Industrial Average fell by 0.1%, retreating from record highs, while the S&P 500 and Nasdaq Composite also experienced slight declines, reflecting investor caution regarding future interest rate policies, with expectations that the Fed will hold rates steady.
- Shifting Rate Expectations: The strong job data has tempered market expectations for Fed rate cuts, with traders now pricing in over a 40% chance that the central bank will maintain current rates in the coming months, which could influence future investment decisions.
- Earnings Reports in Focus: As earnings season unfolds, companies like McDonald's and Cisco will be in the spotlight, particularly with McDonald's expected to report a 5.1% growth in same-store sales, providing further insights into consumer spending and corporate health.
See More
Kraft Heinz Maintains Single Entity Strategy Amid Downgrade
- Lackluster Outlook: Kraft Heinz (KHC) faced a downgrade to Underweight by J.P. Morgan analysts following its Q4 results, indicating ongoing challenges that may limit expected volume growth as 2026 approaches.
- Declining Volumes: Despite investments in innovation and marketing, KHC has experienced over a 3% decline in North American volumes for 19 consecutive quarters, highlighting persistent market share losses and weak category performance.
- Market Share Losses: Nielsen data reveals that KHC is losing volume share in 10 out of its 13 largest U.S. retail categories, including packaged lunch meat, underscoring increasing competitive pressures.
- Delayed ROI on Investments: While KHC anticipates that increased marketing investments will boost sales in Q2 and beyond, analysts express skepticism about the speed of this transformation, suggesting that the 2026 outlook may be overly conservative.
See More
Market Dynamics and Investment Opportunities Analysis
- Industrial Stock Rally: In 2026, industrial stocks like DuPont have shown remarkable performance, with DuPont up approximately 28% year-to-date, reflecting market confidence in industrial recovery; JPMorgan raised its price target from $50 to $57, indicating optimism about future growth.
- Cisco's Decline: Despite reporting strong quarterly results and raising its annual outlook, Cisco's stock fell about 7% in pre-market trading due to high memory prices squeezing gross margins, highlighting market concerns over its future profitability, prompting us to trim our position ahead of the report to mitigate risk.
- AI Market Funding: Anthropic is set to close a $20 billion funding round, valuing the company at $350 billion, which is crucial for the AI sector as it supports cloud providers' infrastructure investments, ensuring sustained compute demand that drives growth in related industries.
- Rising Power Demand: American Electric Power reported better-than-expected fourth-quarter results, having signed agreements for 28 GW of load capacity since October, bringing total energy commitments to 56 GW by 2030, demonstrating a strong response to high electricity demand, with over 10 GW of gas turbine capacity secured from major manufacturers like GE.
See More
Major Wall Street Rating Updates
- Apple Siri Upgrade Delay: Evercore ISI reiterates Apple as outperform, suggesting that reports of delays in Siri upgrades are overstated, with expectations for a multi-phase rollout of AI features this year, emphasizing the importance of privacy protection and seamless integration.
- Shopify Attractiveness Upgrade: TD Cowen upgrades Shopify from hold to buy, citing its strong quarterly performance and continued growth momentum as compelling reasons for investors to consider the stock, especially given its recent price decline.
- Fastly's Stellar Performance: William Blair upgrades Fastly from market perform to outperform following impressive earnings, driven by a significant increase in AI traffic contributions, indicating substantial growth potential in this emerging sector.
- MercadoLibre's Improved Competitive Landscape: JPMorgan upgrades MercadoLibre from neutral to overweight, noting a reduction in competitive pressures in the Latin American online marketplace, with expectations for sustained growth in the coming quarters.
See More
JPMorgan Downgrades Kraft Heinz Amid Challenges
- Rating Downgrade: JPMorgan downgraded Kraft Heinz from neutral to underweight, with analyst Thomas Palmer lowering the price target from $24 to $22, indicating a potential downside of 12% and reflecting market concerns about the company's outlook.
- Poor Performance: Although Kraft Heinz reported a fourth-quarter earnings beat, its earnings per share and organic sales growth outlook for 2026 fell below consensus estimates, indicating the company failed to meet Wall Street's revenue expectations.
- Investment Plans: The company announced a $600 million investment aimed at turning around its U.S. business, with funds allocated to marketing, sales, and R&D, demonstrating a commitment to future growth, although these investments may take time to yield results.
- Ongoing Challenges: Kraft Heinz faces broad-based volume challenges in the U.S., with a 3% year-over-year decline for 19 consecutive quarters, attributed to market share losses and weak category performance, while the pause on its breakup plan further limits the company's financial flexibility.
See More
The Job Market Appears Robust, Yet These Red Flags Indicate AI's Rising Risk.
Job Market Overview: The recent jobs report appears strong, but there are underlying concerns regarding the impact of artificial intelligence on employment.
Sector Vulnerability: Certain professions, like software development, may be more at risk from AI advancements compared to others, such as nursing.
See More
US Jobs Report Exceeds Expectations, Stocks Little Changed
- Strong Job Data: The US economy added 130,000 jobs in January, with the unemployment rate slightly decreasing to 4.3%, indicating resilience in the labor market; however, the 2025 payroll growth was heavily revised down from 584,000 to 181,000, highlighting potential economic slowdown risks.
- Cautious Market Reaction: The Dow Jones Industrial Average fell by 0.1%, retreating from record highs, while the S&P 500 and Nasdaq Composite also experienced slight declines, reflecting investor caution regarding future interest rate policies, with expectations that the Fed will hold rates steady.
- Shifting Rate Expectations: The strong job data has tempered market expectations for Fed rate cuts, with traders now pricing in over a 40% chance that the central bank will maintain current rates in the coming months, which could influence future investment decisions.
- Earnings Reports in Focus: As earnings season unfolds, companies like McDonald's and Cisco will be in the spotlight, particularly with McDonald's expected to report a 5.1% growth in same-store sales, providing further insights into consumer spending and corporate health.
See More
