Why Kraft Heinz (KHC) Stock Continues to Fall Today
NEW YORK (TheStreet) -- Shares of Kraft Heinz (KHC) - Get Report are down by 4.20% to $72.25 in early afternoon trading on Friday, as the stock continues a decline it began in after-hours trading last night following its 2015 third quarter earnings results.
The newly combined company reported earnings of 44 cents per share on revenue of $6.36 billion for the most recent quarter.
Kraft Heinz financial results missed the 62 cents per share on revenue of $6.7 billion that analysts had forecast.
The company's U.S. sales declined by 3.7% to $4.54 billion.
"As we implement and expand methodologies such as Zero Based Budgeting, Management by Objectives and revenue management, we expect to continue creating the freedom to invest in our business and accelerating long-term profitable sales growth," company CEO Bernardo Hees said in a statement.
Insight from TheStreet Research Team:
Kraft Heinz is a holding of Jim Cramer's Action Alerts Pluscharitable trust portfolio. Jim Cramer, Portfolio Manager, and Jack Mohr, Director of Research AAP, recently commented on the company noting that they were adding on the stock's weakness.
KHC is selling off following last night's earnings report, which showed slowing organic sales growth and is spooking investors. However, as we have explained, we are in this name for the long haul as the company continues its rationalization plans, cuts costs, and expands margins to a best-in-class level.
Importantly, the company mentioned it is on track to receive its synergy and cost savings targets from the merger and it has already begun the process with two major cost management initiatives in place.
We believe the selloff is overdone and want to take this opportunity to further lower our basis in the name.
-Jim Cramer and Jack Mohr, "Adding to Kraft Heinz on Weakness" Originally published on 11/06/2015 on Action Alerts PLUS.
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