KHC - The Kraft Heinz Company

NasdaqGS - NasdaqGS Real-time price. Currency in USD
30.43
-0.66 (-2.12%)
As of 1:40PM EST. Market open.
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Previous close31.09
Open31.00
Bid30.35 x 1000
Ask30.36 x 1300
Day's range30.16 - 31.00
52-week range24.86 - 51.85
Volume5,108,179
Avg. volume7,434,326
Market cap37.16B
Beta (3Y monthly)1.04
PE ratio (TTM)N/A
EPS (TTM)-8.87
Earnings date19 Feb 2020 - 24 Feb 2020
Forward dividend & yield1.60 (5.11%)
Ex-dividend date2019-11-14
1y target est31.14
  • Kraft Heinz shares climb after beating earnings estimates
    Yahoo Finance Video

    Kraft Heinz shares climb after beating earnings estimates

    Shares of Kraft Heinz are on the rise after beating quarterly earnings estimates. Yahoo Finance's Ines Ferre reports.

  • Stocks - Wall Street Falls on Concerns Over Global Economic Growth
    Investing.com

    Stocks - Wall Street Falls on Concerns Over Global Economic Growth

    Investing.com – Wall Street was slightly lower on Thursday as concerns about global economic slowdown and a reported snag in U.S.-China trade discussions sent a wave of worry through the market.

  • Walmart's stock is trading at a record high and one sentence reveals why
    Yahoo Finance

    Walmart's stock is trading at a record high and one sentence reveals why

    The world’s largest retailer’s third quarter results on Thursday showed that yet again, CEO Doug McMillon continues to pull almost all the right strings operationally.

  • Stocks - Walmart, Viacom Rise Premarket; Canopy Growth, Cisco Fall
    Investing.com

    Stocks - Walmart, Viacom Rise Premarket; Canopy Growth, Cisco Fall

    Investing.com - Stocks in focus in premarket trading on Thursday:

  • Did Changing Sentiment Drive Kraft Heinz's (NASDAQ:KHC) Share Price Down A Worrying 60%?
    Simply Wall St.

    Did Changing Sentiment Drive Kraft Heinz's (NASDAQ:KHC) Share Price Down A Worrying 60%?

    The Kraft Heinz Company (NASDAQ:KHC) shareholders will doubtless be very grateful to see the share price up 31% in the...

  • 3G Bids for Thyssenkrupp Elevators
    Bloomberg

    3G Bids for Thyssenkrupp Elevators

    (Bloomberg) -- 3G Capital, the private equity firm that’s made a name for itself buying food giants from Kraft to Burger King, is eyeing a new frontier: elevators.The Brazilian-American investment firm is among suitors that submitted bids for Thyssenkrupp AG’s elevator unit by last week’s deadline, according to people familiar with the matter. The business could fetch more than 15 billion euros ($17 billion), the people said, asking not to be identified because the information is private.3G’s interest comes as a surprise, as it’s known more for buying consumer brands like the Popeyes fast-food chain and the maker of Heinz ketchup than it is for acquiring industrial companies. The firm, which often teams up with Warren Buffett’s Berkshire Hathaway Inc. on deals, has earned a reputation for aggressively slashing costs.That formula has fallen flat lately for 3G, which was co-founded by Swiss-Brazilian billionaire Jorge Paulo Lemann. Shares of Kraft Heinz Co. have lost more than a third of their value over the past 12 months, battered by a regulatory investigation, weak results and a writedown on the value of some of its brands.3G is competing for the Thyssenkrupp business against a number of other private equity firms and strategic bidders, a list that’s expected to be whittled down in the next few weeks, the people said.Thyssenkrupp shares were little changed in early Frankfurt trading. The stock has fallen 11% this year.Other BidsFinnish elevator maker Kone Oyj partnered with CVC Capital Partners to make a joint offer, while Blackstone Group Inc. submitted a bid with Carlyle Group LP and Canada Pension Plan Investment Board, the people said. Brookfield Asset Management Inc. and a separate consortium of Advent International, Cinven and the Abu Dhabi Investment Authority lodged their own bids, said the people. Japan’s Hitachi Ltd. has also been considering an offer, Bloomberg News reported earlier.Representatives for Thyssenkrupp, 3G, ADIA, Advent, Blackstone, Brookfield, Carlyle, Cinven, CPPIB, CVC and Kone also declined to comment. Hitachi couldn’t be immediately reached for comment outside regular business hours.Thyssenkrupp is exploring a sale of elevators, its most valuable asset, to generate much-needed cash and fund a turnaround of the steel-to-automotive conglomerate. It’s still debating whether to sell a majority or minority stake in its crown jewel, the people said. It’s also been making separate preparations for a potential initial public offering.The beleaguered German company wants to avoid a long antitrust review and a repeat from earlier this year when European regulators derailed a planned steel venture with Tata Steel Ltd. Buyout firms would avoid competition hurdles, but Finnish rival Kone would potentially be able to make a higher offer and generate more cost savings, people familiar with the matter have said.(Updates with shares in sixth paragraph)\--With assistance from Sarah Syed, Jan-Henrik Förster, Niclas Rolander, Ed Hammond, Scott Deveau, Dinesh Nair and William Wilkes.To contact the reporters on this story: Aaron Kirchfeld in London at akirchfeld@bloomberg.net;Eyk Henning in Frankfurt at ehenning1@bloomberg.netTo contact the editors responsible for this story: Ben Scent at bscent@bloomberg.net, ;Daniel Hauck at dhauck1@bloomberg.net, Nicholas LarkinFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Financial Times

    3G Capital enters bidding for Thyssenkrupp lifts unit

    The Brazilian-backed private equity group 3G Capital has entered the race to buy the lifts business of Thyssenkrupp, in what would be a shift away from its multibillion-dollar investments in the consumer goods industry. The sale of the elevator business could net Thyssenkrupp as much as $20bn, the people said. , which it controls along with Mr Buffett, failed to acquire Unilever in 2017.

  • Kraft Heinz Stock: Glimmer of Hope, or Dead Cat Bounce?
    Market Realist

    Kraft Heinz Stock: Glimmer of Hope, or Dead Cat Bounce?

    To call Kraft Heinz stock (KHC) “unloved” in 2019 would be the understatement of the year. But is a turnaround in the cards?

  • Milk Revival Boosts Battered Farmers in Key States for Trump
    Bloomberg

    Milk Revival Boosts Battered Farmers in Key States for Trump

    (Bloomberg) -- Explore what’s moving the global economy in the new season of the Stephanomics podcast. Subscribe via Pocket Cast or iTunes.Struggling dairy farmers are finally getting some relief after a wave of closures that hit particularly hard in the presidential election battlegrounds of Wisconsin and Minnesota.Even as Americans drink less milk, prices on commodity markets have surged to five-year highs, providing some help to those still operating.While it may be too late to save many farms, the turnaround eases the financial pressure on a swath of President Donald Trump’s rural base ahead of next year’s election. The Trump campaign is trying to pick up Minnesota, which he narrowly lost in 2016, and fighting to hold onto neighboring Wisconsin, which he won last time by fewer than 23,000 votes.Dairy is especially important to Wisconsin. “America’s Dairyland” as the slogan reads on the state’s license plates. Residents embrace the nickname “Cheeseheads,” and foam cheese-wedge hats are staples at sports events and tourist shops. Towns across the state depend on the money dairy farmers spend at equipment dealers, feed stores, cafes and local retailers.“By spring, if we keep the prices where they are now, farmers are going to be in a better mood,” said John Rettler, 57, who with his three sons operates a 240-cow dairy operation near Neosho, Wisconsin.He and his neighbors have endured a five-year glut and trade disputes that have cut access to key export markets. Weather hasn’t been kind either, with a wet spring delaying grain planting and then early snowstorms in October ruining some of the crop of silage and hay farmers planned to feed their cows with over the winter.Dairy farmers are “very crabby” right now, said Rettler, who also presides over the FarmFirst Dairy Cooperative board. “They’re beaten up so badly. How many times do you get kicked in the stomach and get back up?”Many didn’t. In the 12 months ended Oct. 1, one in 10 dairy farms in Wisconsin closed and one in eight in Minnesota. All those closures are finally having an impact on the downtrodden U.S. milk market. Class III futures, which represent milk used to make cheddar cheese, are up about 40% in 2019, heading for the best year since 2007.“People will recover some footing,” said Marin Bozic, a dairy economist at the University of Minnesota. “They’re stepping back from the brink. And they have time to make strategic decisions on their own terms.”Traditional dairy farmers still face tough competition from larger operations, with some groups owning tens of thousands of cows, Bozic said.U.S. per-capita milk consumption has been declining since the late 1970s as Americans shifted away from cereal for breakfast and more people drink other beverages including water and plant-based substitutes such as almond milk.Dairy farmers were hit with more competition from abroad when the European Union lifted milk production caps in 2015. The shift in the U.S. toward more large dairies added to the glut, driving down prices.Low prices and environmental concerns are now finally keeping global production in check. In the U.S., despite the price downturn, the dairy herd initially continued to grow, with larger dairies adding cows as smaller farms closed, Bozic said.More dairy cows finally started to go to slaughterhouses early last year. In August, there were 48,000 fewer cows in the 24 largest producing states than a year earlier, according to U.S. Department of Agriculture.The milk price increase is already hitting food companies such as Dean Foods Co., the top U.S. dairy processor, which cited higher costs for milk in reporting a wider-than-expected loss in the second quarter. Starbucks Corp. singled out higher dairy costs in the current year in an Oct. 30 earnings call. Kraft Heinz Co., meanwhile, said it boosted prices last quarter in the U.S. on products such as macaroni and cheese and Philadelphia cream cheese.Food processors with out-sized exposure to dairy, including cheese, butter and infant formula, face lower margins, said Amit Sharma, an analyst with BMO Capital Markets. Consumers are switching to other beverages as milk prices rise, he added.Exit OpportunityEven with the higher prices, Bozic expects dairies to continue to close at an above-normal rate, predicting another 6% to 7% operating farms will shut down within a year.“There are a lot of farms that their balance sheets have been so damaged that there’s no recovery,” said Mark Stephenson, director of dairy policy analysis at the University of Wisconsin.In some cases, farmers are hanging on in the hope that their inventory of cows and equipment will command higher prices when they sell, said Wayne Gajewski, 59, who has an 80-cow operation near Athens, Wisconsin.“For some I’ve talked with, if they get some equity back, it will be an opportunity to exit the industry because they will have something to walk away with,” Gajewski said. “It’s just the stress of the industry with the margins being so tight.”Gajewski grew up on a farm near his current operation, which he’s been running since 1979. He plans to stick it out and takes the milk-price increase as a sign the industry is moving in the right direction. He expressed hope that the Trump administration will conclude trade deals with China and Japan and win passage of the U.S.-Mexico-Canada Agreement.“Hard times aren’t always necessarily bad because they help people become better managers of what they have,” he said. “For those that survive it, agriculture can have a brighter future.”(Updates with additional context beginning in 12th paragraph)\--With assistance from Lydia Mulvany and Jonathan Roeder.To contact the reporter on this story: Mike Dorning in Washington at mdorning@bloomberg.netTo contact the editors responsible for this story: Joe Sobczyk at jsobczyk@bloomberg.net, James Attwood, Patrick McKiernanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Alarms Still Blare on Triple-B Bonds, But No One Cares
    Bloomberg

    Alarms Still Blare on Triple-B Bonds, But No One Cares

    (Bloomberg Opinion) -- In the bond market, it can sometimes feel as if the more things change, the more they stay the same.Consider the following two articles about the massive amount of triple-B rated corporate debt:“A $1 Trillion Powder Keg Threatens the Corporate Bond Market” by Bloomberg News. The takeaway: “A lot of these companies might be rated junk already if not for leniency from credit raters. To avoid tipping over the edge now, they will have to deliver on lofty promises to cut costs and pay down borrowings quickly, before the easy money ends.”“Bond Ratings Firms Go Easy on Some Heavily Indebted Companies” by the Wall Street Journal. The takeaway: “Amid an epic corporate borrowing spree, ratings firms have given leeway to other big borrowers. … The buildup has fueled one of the most divisive debates on Wall Street: Will higher debt loads cause big losses when the economy turns?”The first one is from October 2018 and the second from a couple of weeks ago. That alone isn’t what’s most interesting — financial-market themes tend to repeat themselves, after all. Rather, it’s the fact that market appetite for those bonds on the brink of junk couldn’t be any more different between then and now, even though it’s clear that fears about ratings inflation and a huge wave of downgrades haven’t gone away.Around this time last year, Scott Minerd, global chief investment officer at Guggenheim Partners, made headlines by tweeting that “the slide and collapse in investment grade credit has begun,” starting with General Electric Co. No one seemed to want to own bonds rated just a step or two above junk — the Bloomberg Barclays triple-B corporate-bond index trailed the broad market in 2018 for just the second time since the financial crisis. I was willing to be contrarian after his comments, writing that investors shouldn’t fear a doomsday that everyone seems to think is coming.Still, the rapid change in sentiment through the first 10 months of 2019 has been nothing short of astounding. While there were signs of the tide starting to turn earlier this year, triple-B bonds have now returned 14.4% through Oct. 30, better than any other rating category. If the gains hold through the end of the year, it would be the triple-B market’s strongest performance since 2009, when it bounced back from its worst annual loss on record amid the financial crisis. Investors have either made peace with the risk of mass downgrades when the credit cycle turns, or they’ve just decided to ignore it and reach for yield when the Federal Reserve is cutting interest rates. Neither seems to be sustainable.It’s not as if the Wall Street Journal’s recent article is an outlier — CreditSights said in an Oct. 30 report that about $70 billion of triple-B corporate debt is at risk of falling to junk within the next 12 months, including household names like Kraft Heinz Co., Macy’s Inc. and Ford Motor Co. It’s not a question of whether so-called fallen angels become more prevalent, according to the analysts, it’s “when and how fast.”As for the “debt diet” that was supposed to happen this year, which would make triple-B companies less leveraged? In the aggregate, it’s been exactly the opposite. Fitch Ratings, in an Oct. 31 report, noted that triple-B corporate issuance is on pace to reach a record in 2019 after accounting for almost two-thirds of the $515 billion in bonds sold through the first nine months of the year. Triple-B securities make up half of the $5.8 trillion investment-grade corporate bond market, Bloomberg Barclays data show.But perhaps the most telltale sign of just how little investors seem to mind the “ratings cliff” between investment- and speculative-grade is how they’re gobbling up double-B bonds just as voraciously as triple-Bs. In fact, on Oct. 28, the spread between the two dropped to 43 basis points, a new low, according to Bloomberg Barclays data. At the start of 2019, it was as high as 172 basis points. Even though triple-B corporate bonds are having their best year in a decade, double-B debt isn’t far behind. This trend isn’t going to end overnight. Investors poured $2.3 billion into investment-grade bond funds in the week through Oct. 30, and an additional $940 million into high-yield funds, according to Lipper data. The sub-2% yield on 10-year Treasuries is probably still causing sticker shock to some investors, given that until a few months ago it hadn’t breached that level since President Donald Trump’s November 2016 election. For those in Japan and Europe, buying U.S. corporate bonds rather than Treasuries is sometimes the only way to avoid negative currency-hedged yields. Global and structural forces keep investors slamming the buy button in credit markets.Eventually, though, something has to give, as it always does. For now, corporate-debt buyers are content to just avoid triple-C rated securities. That includes Guggenheim investors led by Minerd, who said in a note this week that “now is not the right time” to add the riskiest junk debt, given the downside potential of more than 20%.The reasoning makes sense — triple-C rated companies are the most prone to default in an economic downturn. But in such a slump, triple-B companies would be vulnerable to downgrades. If investors were so sure last year that rating cuts would be too much for the high-yield market to bear, why wouldn’t they also stay away from triple-B bonds at this point?There’s no obvious answer. It’s just a reminder that total returns aren’t everything. Even though triple-B securities are the belle of the ball in credit markets this year, nothing much has truly changed.To contact the author of this story: Brian Chappatta at bchappatta1@bloomberg.netTo contact the editor responsible for this story: Daniel Niemi at dniemi1@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Brian Chappatta is a Bloomberg Opinion columnist covering debt markets. He previously covered bonds for Bloomberg News. He is also a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • McDonald's has a new CEO: 3 quick facts about him
    Yahoo Finance

    McDonald's has a new CEO: 3 quick facts about him

    McDonald's CEO Steve Easterbrook has been ousted after an inappropriate relationship with an employee. Here's what we know about the new guy atop the Golden Arches.

  • Berkshire’s Record Quarter Got a Lift From Kraft
    Bloomberg

    Berkshire’s Record Quarter Got a Lift From Kraft

    (Bloomberg) -- For Berkshire Hathaway Inc., profits from its stake in Kraft Heinz Co. were better late than never.Almost a third of the jump in Berkshire’s third-quarter earnings came from finally recording its share of the packaged food giant’s 2019 results. A $467 million gain replaced what had been blank spots in the past two quarters as Kraft Heinz delayed reporting first-half results amid regulatory probes.Kraft Heinz has been a black mark for Warren Buffett over the past year, as he took a $2.7 billion writedown in 2018 results and conceded he and 3G Capital paid too much in the 2015 merger of Kraft Foods Group Inc. and H.J. Heinz. The maker of ketchup and cold cuts replaced its chief executive officer in the search for a new strategy as consumers turn to upstart brands and fresher food options. A 24% share-price drop this year may mean another writedown for Berkshire.“Results haven’t been good with regards to Kraft Heinz,” Jim Shanahan, an analyst at Edward Jones, said in an interview. “It’s certainly been a disappointment.”While nine months of profit hitting in one quarter boosted Berkshire’s results, the bigger picture isn’t as rosy. Kraft Heinz profits going to Berkshire dropped 26% so far in 2019, and dividends fell 36%.The stake has been a recent headache, but Buffett is a long way from being in the red. He’s still up almost $7 billion on his investments in Kraft Heinz, which total $17.5 billion since he and 3G first bought Heinz in 2013.Here are the other key takeaways from Berkshire’s third-quarter results:Railroad RecordBerkshire’s BNSF railroad overcame trade tensions, flooding and a slumping coal business to post a record profit in the quarter. While volume dropped in all four of its main categories, the unit said it benefited from higher rates and its ongoing efforts to rein in costs. BNSF said it returned to full operation in the quarter after floods earlier this year had closed off some of its routes.BNSF’s results and gains on other stock bets pushed Berkshire’s 2019 net income to a staggering $52 billion, making the conglomerate the most profitable public company in the world.Buybacks ClimbingBuffett has started to move past his aversion for stock buybacks, but he’s not exactly diving in. He repurchased another $700 million of stock in the third quarter, bringing 2019’s total to $2.8 billion. That’s already the record for a year, after the board in July 2018 loosened its policy on stock buybacks. Almost a decade ago, Buffett touted the fact that “not a dime” had gone to share repurchases.Still, it’s a modest sum given Berkshire’s $128 billion cash pile and the buybacks of other large companies, especially financial firms. Bank of America Corp., which counts Berkshire among its largest shareholders, said in June that it planned to repurchase more than $30 billion of its stock over the next year.Insurance GainA jump in property-casualty premiums at Berkshire’s reinsurance drove that unit’s first underwriting profit in more than a year. That helped cushion a 40% drop in Geico’s pretax underwriting earnings, which it attributed in part to higher severity in auto claims.The reinsurance gain was in spite of $281 million in losses from Japan’s Typhoon Faxia, and the company warned that last month’s Typhoon Hagibis will weigh on fourth-quarter results. Berkshire is on pace for its 16th underwriting profit in the past 17 years, which Buffett has chalked up to his company’s “religion” of risk evaluation.(Adds Berkshire’s 2019 net income in ninth paragraph.)To contact the reporter on this story: Katherine Chiglinsky in New York at kchiglinsky@bloomberg.netTo contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Ian FisherFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • What Are Warren Buffett's Top 10 Stock Holdings?
    Zacks

    What Are Warren Buffett's Top 10 Stock Holdings?

    Warren Buffett is one of the most legendary investors on Wall Street. What are the top stocks that he owns?

  • Apple and KHC Save the Day for Buffett and Berkshire
    Market Realist

    Apple and KHC Save the Day for Buffett and Berkshire

    Berkshire Hathaway holds stakes in both Apple (AAPL) and Kraft Heinz (KHC). Berkshire Chair Warren Buffett has admired Apple on several occasions.

  • Company News for Nov 1, 2019
    Zacks

    Company News for Nov 1, 2019

    Companies in the news are: SBUX, KHC, TWTR, BMY

  • Will Kraft Heinz Stock Fall after 13.4% Jump?
    Market Realist

    Will Kraft Heinz Stock Fall after 13.4% Jump?

    J.P. Morgan raised the target price to $34 from $28 on Kraft Heinz stock. However, analysts have a consensus target price of $28.94 on the stock.

  • Warren Buffett’s Worst Year Since 2009 Splits Investors
    Bloomberg

    Warren Buffett’s Worst Year Since 2009 Splits Investors

    (Bloomberg) -- Bill Ackman piled in. David Rolfe exited.Berkshire Hathaway Inc.’s rotation of investors over the past few months points to the question lingering over the conglomerate as it heads for its worst annual underperformance since 2009: Is it worth waiting for Warren Buffett to make a dent in his record $122 billion cash pile?Ackman’s stake in Berkshire, disclosed in August, is a bullish bet. His idea is simple: Growth at Berkshire’s underlying businesses and the company’s competitive position will boost earnings even if the funds aren’t deployed. Rolfe, whose firm had been a Berkshire investor for decades, grew tired of waiting.“He has missed this glorious bull market,” said Rolfe, chief investment officer of Wedgewood Partners Inc. His company, which oversees $2.2 billion, trimmed its Berkshire stake in the second quarter and exited completely in the third. “The bullish thesis that this massive amount of cash is going to come to bear incredible fruit -- hasn’t.”Berkshire’s third-quarter results, set to be released Saturday, should give investors a sense of how Buffett is handling the “Niagara” of cash generation in a period with no major acquisitions to ramp up growth. Berkshire stock climbed 4.2% through the end of October, short of the 21% price gain in the S&P 500.Part of that underperformance stems from disappointment that Berkshire’s mountain of cash sits idle, UBS Group AG analysts led by Brian Meredith said in an October note. Buffett has sought out major acquisitions but has failed to strike a large deal in recent years amid what he called “sky-high” valuations.“If you look at sort of all the ingredients in that stock, it’s a stock without a catalyst,” Cathy Seifert, an analyst with CFRA Research, said in an interview.Buffett, Berkshire’s chairman and chief executive officer, has turned to share buybacks to deploy some cash, repurchasing $2.1 billion this year through the end of June. That’s a “modest” amount, according to UBS analysts. JPMorgan Chase & Co., which counts Berkshire among its largest investors, repurchased more than $6 billion on a net basis in the third quarter alone.Buffett was able to put some of his cash to work earlier this year. He agreed in April to invest $10 billion for preferred stock of Occidental Petroleum Corp., which was pursuing Anadarko Petroleum Corp. Berkshire didn’t respond to a request for comment.Some credit Buffett’s patience for his ability to secure well-priced deals that have taken his company from a struggling textile mill to a conglomerate worth more than $500 billion. As the S&P 500 keeps setting records, sitting on the M&A sidelines might be the right move because of high valuations, according to analyst Meyer Shields.“That’s when everyone else is being greedy, in which case you should be fearful and that’s very consistent with their philosophy,” Shields, of Keefe, Bruyette & Woods, said in an interview. “It does translate into doing nothing. But maybe nothing is the right approach or the best of all the bad alternatives.”Rolfe said the biggest driver for Berkshire’s growth will be the billionaire investor’s ability to reinvest the funds at Berkshire, which enjoys what Buffett has called a “Niagara of cash-generation.” The record funds on the balance sheet and the cash coming from its multitude of insurance companies, retailers and energy businesses every quarter make that task challenging, he said.“He has a gigantic task ahead of him,” Rolfe said. “If he is successful doing that, really successful, then Bill Ackman will be right and I’ll be wrong.”For now, Rolfe took the roughly $200 million that was invested in Berkshire and redeployed the vast majority into the stock of a company Buffett once said he regretted not betting on: Alphabet Inc.Here are some other topics that might come up Saturday:Kraft HeinzBerkshire’s bet on the packaged-food giant has stumbled in recent quarters as Kraft Heinz Co. grappled with writedowns, a management shakeup and investigations. Buffett, who teamed up with 3G Capital to help orchestrate the merger of Kraft and Heinz, has admitted that they overpaid for Kraft and said in February that he had no plans to sell or buy more of the company’s stock.Kraft Heinz shares surged 13% Thursday after the company reported strong earnings driven by higher prices for products such as macaroni and cheese. While sales beat estimates, they still declined from a year earlier, highlighting the challenge ahead for CEO Miguel Patricio.Thursday’s gain narrowed Kraft Heinz’s loss this year to 25%, helping ease the pressure on the value of Berkshire’s stake. Still, the holding value has fallen below how it’s marked on Berkshire’s books. That could mean that Buffett’s company will take an eventual writedown, according to CFRA’s Seifert.“The Kraft Heinz deal is a big black mark on the track record of Berkshire’s acquisitions,” she said in an interview.Share BuybacksBerkshire loosened its repurchase strategy last year, then bought back $928 million of stock during the third quarter of 2018. It has spent a total of $3.4 billion on repurchases since the policy tweak.KBW’s Shields says he expects Berkshire to report about $536 million in share buybacks. UBS analysts are assuming that Berkshire repurchased around $900 million of its stock in the quarter. Both estimates would outpace its repurchases in the second quarter.“I don’t think it’s evolved enough,” Seifert said of Berkshire’s buyback policy. “I think it was, in some respects, a way to placate shareholders.”InsuranceInsurers including Travelers Cos. are warning about challenging legal issues. Travelers CEO Alan Schnitzer has said he’s seen a “more aggressive” level of attorney involvement on some claims. That could factor into Berkshire’s insurance results, according to KBW’s Shields.“Companies are acknowledging that the environment for litigation has gotten more difficult,” Shields said.Shields also said that rate cuts at auto insurer Geico could weigh on margins, even if it sees faster policy growth.And natural catastrophes hit during the quarter, including Typhoon Faxai and Hurricane Dorian. The typhoon, which pummeled Japan in September, caused as much as $7 billion in insured losses, according to risk modeler AIR Worldwide. Dorian tore through the Bahamas in the third quarter, leaving behind as much as $3 billion in estimated insured losses.Rail RecessionU.S. railroads have been dealing with the fallout from trade disputes, leading to concerns about a “rail recession.” BNSF’s rival in the Western U.S., Union Pacific Corp., reported third-quarter profit that missed analyst estimates and the steepest drop in carloads in three years.UBS analysts said in a note that BNSF’s volumes probably declined in the third quarter, but the railroad might benefit from a boost in revenue per car.“They have one of the top franchises in the industry, but there’s some cyclical pressures there,” Seifert said.Market SwingsGyrations in Berkshire’s $200 billion stock portfolio now factor into net income, an accounting change that Buffett says investors should look past. Barclays Plc said the investment gains could total $7 billion before taxes.To contact the reporter on this story: Katherine Chiglinsky in New York at kchiglinsky@bloomberg.netTo contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Dan Reichl, Josh FriedmanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Kraft Surges Midday After Earnings Impress
    Investing.com

    Kraft Surges Midday After Earnings Impress

    Investing.com - Food company Kraft Heinz (NASDAQ:KHC) jumped in midday trade on Thursday as its sales and earnings beat estimates.

  • Zacks

    Kraft Heinz (KHC) Q3 Earnings Surpass Estimate, Sales Lag

    Kraft Heinz (KHC) shows signs of improvement post third-quarter results, wherein earnings beat estimates. However, dismal sales remain a drag.

  • Kraft Heinz, Altria, Ford, Exxon and Hershey: Stocks to Watch
    Yahoo Finance

    Kraft Heinz, Altria, Ford, Exxon and Hershey: Stocks to Watch

    Kraft Heinz, Altria, Ford, Exxon and Hershey are some of the companies the Yahoo Finance team will be watching.

  • Kraft Heinz Shares Rise as Higher Prices Underpin Rebound
    Bloomberg

    Kraft Heinz Shares Rise as Higher Prices Underpin Rebound

    (Bloomberg) -- Kraft Heinz Co. investors are finally giving the company’s new chief the breathing room he needs to turn things around.After pummeling the stock in August when Miguel Patricio said he hadn’t yet developed a “comprehensive strategy” just five weeks after taking the reins, shareholders cut him some slack after the company reported third-quarter profit that beat estimates on Thursday. The shares jumped up as much as 12%, the most intraday in more than two and a half years, as he started to formulate a vision for the struggling food maker. The stock reached its highest point since early August.“Three months in and we are getting to deeply understand our business,” Patricio said in a conference call after reporting earnings, promising he’ll be “candid” and transparent when laying out the good and the bad. “We are not where we believe we can be, but we are excited with the evolution.”The profit came amid higher prices for items like macaroni and cheese, Oscar Mayer cold cuts and Philadelphia cream cheese in the U.S. Kraft Heinz joins a slew of consumer-goods companies, such as Church & Dwight and Clorox, in hiking prices in recent quarters. Sales also outpaced analysts’ estimate, but still declined from a year earlier, underscoring the challenge Kraft Heinz faces as consumers abandon established brands for upstarts and new competitors.Patricio is looking for a way forward for the maker of Heinz ketchup as consumers look for healthier, fresher foods. He said the third-quarter results “remain below our potential” -- but investors were still heartened that the company seems to be formulating a path forward. Next year will be about stabilization, Patricio said, “to give us the time to be working on the pipeline for the future.”Innovation ‘Frenzy’He said too many new product launches added complexity to the company’s operations in recent years, adding that a “frenzy of innovation” sought to compensate for the decline in net sales. “We have not been successful on that,” he said.Now, the food giant will focus on fewer projects with a wider scope, and it will spend more to market the products that drive profitability. It will also revamp product development to be “faster and more consumer-centric.”Once again, Kraft Heinz didn’t offer guidance, but the company expects performance in the fourth quarter to be similar to the third quarter. Patricio said in August he didn’t have enough confidence to issue a forecast at that time, spooking Wall Street.The share rise offers some redemption as a rough year starts to come to a close. In February, Kraft Heinz announced a $15.4 billion writedown on its brands, weak profits and an SEC subpoena. Later in the year, an additional subpoena was announced related to procurement practices and it was forced to restate several years of earnings. In its August release, the company reported two new impairment charges totaling about $1.2 billion.(Updates share trading and adds comments from CEO.)To contact the reporter on this story: Deena Shanker in New York at dshanker@bloomberg.netTo contact the editors responsible for this story: Anne Riley Moffat at ariley17@bloomberg.net, Jonathan RoederFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

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