Kraft Heinz Company is of the largest food & beverage companies, offering food and beverage products, including cheese, meats, refreshment beverages, coffee, packaged dinners, refrigerated meals, snack nuts, dressings, ketchup, condiments and sauces, frozen food, soups, beans and pasta meals, infant nutrition, and other food and grocery products. The company was founded in 2015 and is based in Pittsburgh, Pennsylvania.
KHC Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for KHC, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Kraft Heinz Co ranked in the 59th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 71.83% on a DCF basis. As for the metrics that stood out in our discounted cash flow analysis of Kraft Heinz Co, consider:
Kraft Heinz Co's effective tax rate, as measured by taxes paid relative to net income, is at 28 -- greater than 89.38% of US stocks with positive free cash flow.
The weighted average cost of capital for the company is 10. This value is greater than 79.51% stocks in the Consumer Defensive sector that generate free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
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Kraft Heinz (KHC) has made an important deal in tackling its debt load which has been strangling the company for years. Mid-September, the company announced a deal to sell its natural cheese business to Lactalis. The deal looks reasonable as the company is addressing leverage and with pro-forma earnings multiples...
The Value Investor on Seeking Alpha | September 28, 2020
French-headquartered Lactalis Group has entered into a definitive agreement for the acquisition by its US affiliate of Kraft Heinzâs natural, grated, cultured and specialty cheese businesses in the US, grated cheese business in Canada, and entire international cheese business outside North America.