TD Cowen Lowers Kraft Heinz (KHC) as Food Sector Faces Cost Pressures

The Kraft Heinz Company (NASDAQ:KHC) is included among the 15 Cheapest Stocks with Highest Dividends.

TD Cowen Lowers Kraft Heinz (KHC) as Food Sector Faces Cost Pressures

On March 25, TD Cowen analyst Robert Moskow lowered the price recommendation on The Kraft Heinz Company (NASDAQ:KHC) to $20 from $24 and maintained a Hold rating. The firm also reduced earnings estimates and price targets across several large-cap food companies. This reflects expectations of higher input costs tied to the Iran war, along with limited pricing power. The analyst noted that many food companies are now prioritizing debt reduction after margin pressure in 2025.

During the company’s Q4 2025 earnings call, management said the planned $600M investment will be spread across pricing, product development, packaging, and capability building. About half of that investment is expected to go toward strengthening brands and consumer-facing initiatives. They said they expect trends to improve in the second half of the year. The goal is to exit 2026 in a stronger position and set up organic growth in 2027.

CEO Steven Cahillane indicated that the company is working toward returning to growth by 2027. Management also pointed to potential pressure from SNAP-related factors, estimating a headwind of around 100 basis points. They said this would be addressed through adjustments in pricing strategies and pack sizes. On capital allocation, management said excess cash will first be reinvested into the business, followed by debt reduction. Share buybacks would only be considered after leverage targets are met.

The Kraft Heinz Company (NASDAQ:KHC) manufactures and markets food and beverage products globally. Its portfolio spans multiple consumer-focused platforms, including Taste Elevation, Easy Ready Meals, Substantial Snacking, Desserts, Hydration, Cheese, Coffee, Meats, and other grocery categories.

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