Yesterday I bought a few shares in Kraft Heinz company. This is a situation where I believe Mr Market is too depressed. Although Kraft Heinz is facing more competition from more healthy alternatives and from the stores own brands. I believe it is still a good investment. As a result from the SEC investigation, they now stop the focus on cost cutting, and focus more on products. It seems the management is on their way to turn around the company.
The share price has plummeted from $80 to about $30 these days. With a p/b of 0,72 p/e of around 9, and a dividend about 5,2%, this seems like a low risk investment. Dividend investors have sold the shares due to the dividend cut, and others have dumped the shares because of the procurement scandal. In short, it is not a popular stock.
I see these possible triggers going forward:
* New CEO with the right focus
* New “modern” healthy products
* Better marketing
* increased earnings due to these investments
* Possibly a split of Kraft and Heinz?
* All the bad news is out in the open.
This is a buy and forget kind of investment. I’ll have a look at it about 4 years, and see how it has performed.