Current Analysis: Kraft Heinz (KHC)

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The Kraft Heinz Corp (KHC) came together in March 2015 when Kraft joins Heinz to form the third largest food and beverage company in North America na the fifth largest in the world.

Beyond its namesakes, other active brands include Oscar Mayer, Velveeta,  and Philadelphia. While the retail channel drives about 85% of total sales, the firm operates growing food service operation.

Outside North America Kraft Heinz’s global reach counts distribution network in Europe and emerging market countries that drives 20% to 25% of consolidated sales. Kraft Heinz claims a presence inmate than 190 countries and territories.

Kraft Heinz is headquartered, appropriately, in Philadelphia, PA.

Three key data points gauge Kraft Heinz or any dividend-paying firm.

The key three are:

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether any company has made, is making, and will make money.

 

KHC Price

Over the past year, KHC’s share price fell about 1.4% from $39.62 to $35.80 as of Monday’s market close.

If KHC shares trade in the range of $30.00 to $40.00 this next year, its recent $35.80 share price might rise to $38.30 by next year. Of course, Kraft Heinz price could drop about the same $2.50 estimated amount, or more.

My annual upside estimate of $1.50 however, is about equal to the median of one-year price targets from 21 analysts tracking KHC.

 

KHC Dividend

The Kraft Heinz Corp has paid  Quarterly dividends since July 31, 2015. KHC’s most recent declared Quarterly dividend, of $0.40 will be paid December 29th to shareholders on record as of November 30th.  A forward looking $1.60 annual dividend yields 4.47% at Monday’s $35.80 share price,

 

VGR Returns

To put it all together, add the  annual dividend of  $1.60 to the price upside of $2.50 to find a $4.10 gross gain.

At Monday’s $35.80 share price, a little over $1000 would buy 28 shares.

A $10 broker fee (if charged), paid half at purchase and half at sale, might cost us about $0.36 per share.

Subtracting that likely $0.36 brokerage cost from the $4.10 estimated gross gain per share produces a net gain of $3.74 X 28  shares = $104.72 for a 10.5% estimated net gain.

You might choose to pounce on The Kraft Heinz Corp. KHC is an eight year old Philadelphia food and beverage company noted as the fifth largest in the world. Furthermore, the estimated $44.70 of dividend income from $1k invested is about 1.25 times greater than Friday’s KHC single share price.

The exact track of The Kraft Heinz Corp ongoing future prices and dividends are yet to be known.

Remember the true value of any stock is best realized through personal ownership of shares.


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Disclaimer:  This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a ...

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