KHC - Embedded Expectations Analysis - 2020 12 18
The Kraft Heinz Company (KHC:USA) currently trades below recent averages relative to UAFRS-based (Uniform) earnings, with a 19.3x Uniform P/E. At these levels, the market is pricing in bearish expectations for the firm, and management may be concerned about adjusted EBITDA, net organic sales growth, and customer retentionSpecifically, management may lack confidence in their ability to maintain strong adjusted EBITDA, meet their 2021 guidance, and grow their savings investment. Moreover, they may lack confidence in their ability to grow net organic sales in Q4, sustain strong household penetration and share trends, and focus on their consumer platform. Furthermore, they may be concerned about their six platforms in the U.S. and the supply constraints in some of their key categories. In addition, they may lack confidence in their ability to increase customer retention and continuously improve retail market share. Also, they may have concerns about their ability to improve processes and sustain a high level of workforce engagement. Finally, management may be concerned about the centralization of their customer development and revenue management teams
Kraft Heinz is a food and beverage company. The company manufactures and markets food and beverage products, including condiments and sauces, cheese and dairy, meals, meats, refreshment beverages, coffee, and other grocery products throughout the world. The company has three reportable segments defined by geographic region: United States, Canada, and Europe, Middle East, and Africa. The company's remaining businesses are combined and disclosed as Rest of World. Rest of World comprises two operating segments: Latin America and Asia Pacific.
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