TD Cowen analyst Robert Moskow maintained a Hold rating on Kraft Heinz (KHC – Research Report) today and set a price target of $27.00.
Robert Moskow has given his Hold rating due to a combination of factors impacting Kraft Heinz. The company has recently lowered its profit guidance by approximately 5%, attributing this to rising inflation, consumer elasticity, and the necessity for additional investments in areas such as media and product reformulation. While the commitment to reinvestment is viewed positively, the path to recovery is expected to be challenging given the current market conditions.
Despite Kraft Heinz’s strategic moves to enhance brand growth and increase spending on media and R&D, there are concerns about whether the revised guidance sufficiently accounts for the inflationary pressures. The company faces significant cost increases, partly due to tariffs, and the potential need for deeper price discounts due to declining U.S. retail volumes and possible government cuts to the SNAP program. These factors, combined with the company’s exposure to commoditized categories, contribute to the cautious outlook and the Hold rating.
In another report released today, Wells Fargo also reiterated a Hold rating on the stock with a $30.00 price target.