The Kraft Heinz Co. (NASDAQ:KHC) announced first-quarter results in line with consensus estimates. The food and beverage company reported Q1 adjusted earnings of $0.69 per share, up by 1.5% year-over-year and in line with Street estimates.
Moreover, the company’s net sales declined by 1.2% year-over-year to $6.41 billion as compared to analysts’ estimates of $6.43 billion.
KHC’s FY24 Outlook and Dividend
Looking forward, KHC reiterated its FY24 outlook and now expects its organic net sales to stay flat or grow by 2% year-over-year. Adjusted earnings are likely to increase in the range of 1% to 3% year-over-year to be between $3.01 and $3.07 per share.
Furthermore, the company’s Board of Directors declared a regular quarterly dividend of $0.40 per share of common stock payable on June 28 to stockholders of record as of June 6, 2024.
Kraft Heinz’s Licensing Deal with TGI Fridays
Additionally, KHC announced a ‘perpetual extension’ of its current licensing deal with TGI Fridays. Under this agreement, Kraft Heinz will continue producing TGI Fridays’ branded frozen appetizers for retail sale in North America. The licensing partnership was established in 2001.
Interestingly, this new perpetual licensing agreement will replace the previous deal from 2015. It will allow Kraft Heinz to enhance and expand the product line, offering improved ingredients, flavors, and varieties.
Is KHC a Buy or Sell?
Analysts remain cautiously optimistic about KHC stock, with a Moderate Buy consensus rating based on five Buys, eight Holds, and one Sell. Year-to-date, KHC has increased by more than 5%, and the average KHC price target of $37.86 implies a downside potential of 1.9% from current levels. These analyst ratings are likely to change following KHC’s Q1 results today.
