Kraft Foods( KFT) is the world's second largest food and beverage company after competitor Nestlé (NSRGY) - Get Nestle SA ADR Report. It also competes with PepsiCo (PEP) - Get PepsiCo Inc. Report, General Mills (GIS) - Get General Mills Inc. Report and Kellogg (K) - Get Kellogg Company Report. We currently have a Trefis price estimate of around $36 for Kraft Foods's stock, about 22% above the current market price of close to $29.
Trefis members have created forecasts for two key drivers of Kraft's stock over the last week: (1) Kraft Market Share in Gum and (2) Global Gum Market. The member forecasts suggest that Kraft Market Share in Gum will trend above the Trefis forecast.
We estimate that Chocolate, Candy and Gum constitute around 32% of the $36 Trefis price estimate for Kraft Foods' stock. Hence the stock is quite sensitive to (1) Kraft Market Share in Gum and (2) Global Gum Market. Below are charts showing recent estimates created by Trefis members for the two drivers in detail.
1. Kraft Market Share in Gum
The average of forecasts for Kraft Market Share in Gum created by Trefis members indicated a projected increase from around 30% in 2010 to 34% by the end of the Trefis forecast period, compared to the baseline Trefis estimate of an increase from around 27% in 2010 to around 29% by the end of the Trefis forecast period. The member estimates imply an upside of 2% to the Trefis price estimate for Kraft Foods' stock. Before Kraft's acquisition of Cadbury, the company's Market Share in Gum was under 1%.
You can drag the forecast trendline above to express your own view, and see the sensitivity of Kraft Foods's stock to Kraft Market Share in Gum.
complete analysis for Kraft Market Share in Gum is here.
2. Global Gum Market
The baseline Trefis estimate projects an increase from $14 billion in 2010 to around $18.6 billion by the end of the Trefis forecast period. In the past, Global Gum Market has increased from around $10.8 billion in 2005 to around $13.6 billion in 2009.
You can drag the forecast trendline above to express your own view, and see the sensitivity of Kraft's stock to Global Gum Market.
complete analysis for Kraft Foods's stock is here.
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