It's a battle of the stocks as Kraft Heinz Co. (NYSE:KHC) and Restaurant Brands International Inc. (NYSE:QSR) prepare to release their fourth-quarter earnings on Wednesday.
The technical indicators paint two very different pictures for these stocks, and both face crucial resistance levels as they approach their earnings reports.
Kraft Heinz: Battling Bears & Resistance
KHC stock has had a rough ride, down 19.09% over the past year and 4.39% year-to-date. Trading at $29.43, the stock is below its five, 20, and 50-day exponential moving averages, signaling a strong bearish trend.
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The eight-day and 20-day simple moving averages (SMAs) are at $29.14 and $29.27, respectively, with the stock trading above them, suggesting short-term strength.
However, the stock's MACD (moving average convergence/divergence) of a negative 0.28 indicates bearish sentiment. KHC stock also trades below its 50-day SMA of $30.15 and its 200-day SMA of $33.34, with its RSI (relative strength index) of 48.56 hints at neutral conditions.
Any dip in RSI from here towards oversold conditions under 30, could set the stage for a possible rebound if earnings surprise positively.
Wall Street expects fourth-quarter earnings of 78 cents per share and $6.67 billion in revenue, per Benzinga Pro data.
Read Also: Coffee Prices Soar Over 100%, Near Historic Rally As Inflation Percolates Through Supply Chain
Restaurant Brands: Riding The Bullish Wave
Restaurant Brands, the parent company of Tim Hortons and Burger King, is enjoying a more bullish outlook. Trading at $66.13, QSR stock is above its five, 20, and 50-day exponential moving averages, indicating strong buying pressure.
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The eight-day SMA of $63.58 and 20-day SMA of $62.25 signal further upward momentum, although the 200-day SMA at $69.00 presents resistance.
With an RSI of 66.44, QSR is nearing overbought levels, signaling caution.
Wall Street expects fourth-quarter earnings of 79 cents per share and $2.27 billion in revenue, per Benzinga Pro data.
Investor Takeaways
Kraft Heinz faces a fight against bearish trends, but a strong earnings report could spark a rebound.
Restaurant Brands is riding high but may hit resistance—investors should watch for signs of a pullback before jumping in.
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