Was This Analyst's Prediction About Kraft Heinz (KHC) Wrong?

We recently published 10 Stocks Moving on Buzzing News as Analyst Issues Strong Warning About AI Valuations. The Kraft Heinz Company (NASDAQ:KHC) is one of the stocks moving on buzzing news.

In August 2024, Dave Sekera, Morningstar’s Chief U.S. Market Strategist, said during a program on CNBC that Kraft Heinz Co (NASDAQ:KHC) was attractive and gave the stock his highest rating. The analyst at the time also talked about the stock’s valuation:

“Kraft Heinz is one that I find especially attractive today. It’s a five-star rated stock, that’s our highest rating, and it trades at about a 37% discount to our fair value and provides a 4.5% dividend yield. We recently upgraded our economic moat rating on that stock. The economic moat rating to narrow means that we think that company can generate excess returns on invested capital for at least the next 10 years before they get competed away. The investment thesis coming from our team here is that the company has really switched its strategy. They’re really looking to drive more long-term profitable growth.”

Kraft Heinz Co (NASDAQ:KHC) is down about 20% over the past 12 months.

Hotchkis & Wiley Large Cap Disciplined Value Fund stated the following regarding The Kraft Heinz Company (NASDAQ:KHC) in its second quarter 2025 investor letter:

 “The Kraft Heinz Company (NASDAQ:KHC) is the third largest U.S. food and beverage company. KHC shares declined following mixed earnings results in the quarter. While organic sales growth over the medium term is likely to be just 1-2%, we believe the company can also make bolt-on acquisitions and share repurchases to further ensure positive earnings per share (EPS) growth. Modest EPS growth combined with a dividend yield above 4% should result in a competitive total return.”

While we acknowledge the potential of KHC as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.