Here's Why This Analyst Maintains Kraft Heinz As A Top Pick

Here's Why This Analyst Maintains Kraft Heinz As A Top Pick
  • Mizuho analyst John J. Baumgartner reiterated the Buy rating on the shares of Kraft Heinz Co KHC with a price target of $48.00.
  • The analyst said that the market jitters about food industry pricing and tighter consumer budgets moderating demand at a faster rate are causes for investor concerns.
  • Baumgartner added that their consumer surveys indicated a clear shift away from discretionary spending, increasing consumption, and trading down to lower-priced options across perimeter categories.
  • Also ReadKraft Heinz Sells This Business - As Part Of Active Portfolio Optimization
  • Meanwhile, the analyst thinks the company is better positioned for three main reasons. First, the portfolio's weakest links versus private label have been divested. Second, multi-year enhancements to ingredients better position Kraft to capture consumers trading down from higher-priced alternatives. Third, larger exposure to opening price point products and channels enhances portfolio appeal for cash-strapped consumers.
  • Baumgartner thinks Kraft Heinz as an underappreciated defensive name.
  • Price Action: KHC shares are trading higher by 1.37% at $36.55 on the last check Friday.

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