Head-To-Head Analysis: The Kraft Heinz Company (KHC) versus Kraft Foods Group (KRFT)

The Kraft Heinz Company (NASDAQ: KHC) and Kraft Foods Group (NASDAQ:KRFT) are both consumer staples companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, profitabiliy, institutional ownership and analyst recommendations.

Institutional & Insider Ownership

62.6% of The Kraft Heinz Company shares are held by institutional investors. 26.9% of The Kraft Heinz Company shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares The Kraft Heinz Company and Kraft Foods Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The Kraft Heinz Company 13.12% 7.25% 3.47%
Kraft Foods Group 9.86% 38.66% 7.47%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for The Kraft Heinz Company and Kraft Foods Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The Kraft Heinz Company 0 4 10 1 2.80
Kraft Foods Group 0 0 0 0 N/A

The Kraft Heinz Company presently has a consensus price target of $98.67, suggesting a potential upside of 10.35%. Given The Kraft Heinz Company’s higher probable upside, research analysts plainly believe The Kraft Heinz Company is more favorable than Kraft Foods Group.

Valuation & Earnings

This table compares The Kraft Heinz Company and Kraft Foods Group’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
The Kraft Heinz Company $26.28 billion 4.14 $8.40 billion $2.82 31.71
Kraft Foods Group N/A N/A N/A N/A N/A

The Kraft Heinz Company has higher revenue and earnings than Kraft Foods Group.

Dividends

The Kraft Heinz Company pays an annual dividend of $2.40 per share and has a dividend yield of 2.7%. Kraft Foods Group does not pay a dividend. The Kraft Heinz Company pays out 85.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

The Kraft Heinz Company beats Kraft Foods Group on 8 of the 11 factors compared between the two stocks.

The Kraft Heinz Company Company Profile

The Kraft Heinz Company is a food and beverage company. The Company is engaged in the manufacturing and marketing of food and beverage products, including condiments and sauces, cheese and dairy, meals, meats, refreshment beverages, coffee and other grocery products. The Company’s segments include the United States, Canada and Europe. The Company’s remaining businesses are combined as Rest of World. The Rest of World consists of Latin America and Asia, Middle East and Africa (AMEA). The Company provides products for various occasions whether at home, in restaurants or on the go. The Company’s brands include Heinz, Kraft, Oscar Mayer, Philadelphia, Planters, Velveeta, Lunchables, Maxwell House, Capri Sun, and Ore-Ida. The Company’s products are sold through its own sales organizations and through independent brokers, agents and distributors to chain, wholesale, cooperative and independent grocery accounts, convenience stores, drug stores, value stores, bakeries and pharmacies.

Kraft Foods Group Company Profile

Kraft Foods Group, Inc. is a consumer packaged food and beverage company. The Company manufactures and markets food and beverage products, including cheese, meats, refreshment beverages, coffee, packaged dinners, refrigerated meals, snack nuts, dressings, and other grocery products, primarily in the United States and Canada. Its product categories span breakfast, lunch and dinner meal occasions. The Company operates in six segments: Cheese, Refrigerated Meals, Beverages, Meals & Desserts, Enhancers & Snack Nuts and Canada. Its brand portfolio consists of various food brands in North America, including Kraft cheeses, dinners and dressings; Oscar Mayer meats; Philadelphia cream cheese, and over 25 other brands. The Company operates around 36 manufacturing and processing facilities, 34 in the United States and two in Canada. It sells products to supermarket chains, wholesalers, supercenters, club stores, distributors and convenience stores, among others.

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