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Kraft Heinz (KHC) to Report Q3 Earnings: What's in Store?

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The Kraft Heinz Company KHC is likely to register a decline in the top and the bottom line when it reports third-quarter 2021 numbers on Oct 27. The Zacks Consensus Estimate for quarterly revenues is pegged at $6,143 million, which suggests a decline of 4.6% from the figure reported in the prior-year quarter.

The Zacks Consensus Estimate for quarterly earnings has remained unchanged at 58 cents per share in the past 30 days. The figure suggests a decline of 17.1% from the year-ago quarter’s reported figure. The manufacturer and marketer of food and beverage products has a trailing four-quarter earnings surprise of 11.5%, on average. In the last reported quarter, the company delivered an earnings surprise of 6.9%.

The Kraft Heinz Company Price and EPS Surprise

The Kraft Heinz Company Price and EPS Surprise
The Kraft Heinz Company Price and EPS Surprise

The Kraft Heinz Company price-eps-surprise | The Kraft Heinz Company Quote

Things to Note

Kraft Heinz has been grappling with cost inflation for a while. Management, in its last earnings call, highlighted that it expects increased inflationary pressures against more difficult pricing comparisons. The company is also spending more to support the transformation.

Management envisions constant-currency adjusted EBITDA decline of low-single-digit percentage from 2019 levels during the third quarter of 2021. The metric includes more than 8 points of adverse impact from the Nuts divestiture, the McCafe exit and more normalized incentive compensation. Compared with the 2020 period’s levels, the metric is likely to have declined in low-teens percentage during the quarter under review.

That being said, Kraft Heinz expects a mid-single-digit percentage growth in organic net sales for the third quarter compared with 2019 period’s levels. The outlook reflects on higher retail consumption, solid emerging market growth and ongoing improvements in the foodservice business. However, the projection includes more than one-point unfavorable impact from the McCafe exit.

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Kraft Heinz this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Kraft Heinz carries a Zacks Rank #2 and an Earnings ESP of -0.62%.

Stocks With Favorable Combinations

Here are some companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat.

The Hershey Company HSY currently has an Earnings ESP of +1.02% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Tyson Foods, Inc. TSN currently has an Earnings ESP of +19.13% and a Zacks Rank of 3.

Hormel Foods Corporation HRL currently has an Earnings ESP of +1.59% and carries a Zacks Rank #3.

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Hershey Company The (HSY) : Free Stock Analysis Report

Hormel Foods Corporation (HRL) : Free Stock Analysis Report

Tyson Foods, Inc. (TSN) : Free Stock Analysis Report

The Kraft Heinz Company (KHC) : Free Stock Analysis Report

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