NYSE:KFT
$28.92
(2/9 1:28PM)
+2.0%
| Open | $28.48 |
Mkt Cap | $41.9 Billion |
| High | $29 |
52Wk High | $30.10 |
| Low | $28.37 |
52Wk Low | $20.81 |
| Volume | 14.7 Million |
Avg Vol 10D | 28.6 Million |
Ockham's Rating/Recommendation Summary
Rating specific information requires Premium Access.
Buy Now
or
Learn More about Ockham's Features and Services.
KFT Revenue
As a value investing shop, we are interested in seeing how KFT's revenues measure up against past performances. One easily understandable way of doing that is to compare Price to Sales per share levels over a given time frame. Assuming it is available, Ockham prefers to look at ten years of history (for this stock there are 10 years of history available) and we weigh recent years more heavily. This allows us to find weighted average historical high and low Price to Sales ratios, which give us a better idea of the stock's current underlying value. Using this method, we have established a high range for Price to Sales of 1.68x and the low end of the range at 1.26x.
With respect to these historically rational metrics, notice that the current Price to Sales per share ratio for KFT of 1.05x is well below its normal historic Price to Sales levels. At a price of $28.44, KFT is 29% below where we would expect to see it. Clearly, this stock looks undervalued compared to historical levels, at least on a Price to Sales basis. This will positively affect our analysis because it is rare to find a stock this far below historical norms, and we would expect some price appreciation to bring this metric back towards a more normal range.
KFT Cash Earnings
As the old saying goes, "Cash is King!" We look at reported Cash Earnings, but the main emphasis of our analysis involves stripping out non-cash events such as depreciation from our cash earnings analysis. This helps us view the cash flows more clearly. Nevertheless, an analysis of Cash Earnings (both reported and otherwise) is absolutely pivotal to assessing a company's value, and currently KFT is below its historical average multiple of Cash Earnings. Looking at the last 10 years we can get a good understanding of what investors have grown to expect from KFT. For example, KFT's Cash Earnings ratio per share has fluctuated between 12.30 and 16.40 over this historical timeframe. This range is based upon a proprietary weighted methodology at Ockham, but can clearly show an investor where KFT is with respect to prior business periods.
At its current price of $28.44, the Price to Cash Earnings ratio of 12.42 per share for KFT is relatively attractive. At current profitability levels, a drop in share price would only improve our future expectations. Again, Cash Earnings is an incredibly valuable metric, and management at KFT must continue on its generation to improve our overall outlook for the stock.
KFT Dividends
A strong dividend payment history is looked upon as a favorable characteristic on a company’s future and potentially can receive a positive Ockham rating. That being said, we don't require dividend payments for company's whose management has elected to forgo them entirely.
When reviewing dividend yields for KFT, we compare the historic high and low levels over the past, which is similar to our evaluation of Sales and Cash Earnings per share. Paying a dividend is not necessary for any company, but changes in dividend often can lend clues as to the health of the business. A rising dividend is a strong sign for an established company, as it reflects management's confidence in the company. KFT’s estimated annual dividend is $1.16 resulting in a current dividend yield of 4.08%. The highest dividend yield from KFT over recent history was 5.57% while the lowest dividend yield was 0.37%. KFT’s current dividend yield is therefore significantly higher than its median dividend yield historically. In fact, the current yield is 37.37% above the median which weighs very positively on our analysis of KFT.
Fast Money Discussed KFT in Relation to M&A Activity
News broke today regarding mergers and acquisitions and Kraft Foods, Incorporated Class A was discussed as well on Fast Money. Other sources will be required to know exactly what the context was in the discussion.
Based on our methodology, Kraft Foods, Incorporated Class A should hold some appeal to value investors as we view it as Undervalued. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey. We noticed recently that in comparison to all other stocks we analyze in the news; KFT has received less coverage from the financial media in business television and blogs.
“… Ggp is another one and obviously he talked a lot about KRAFT and went through a very compelling story about why, not only why he likes KRAFT on his own and the merger with cad ... …”
Kraft Foods, Incorporated Class A Dividend News from WSJ Marketbeat
If KFT's dividends are important to you, take a look at the news as they were the topic of conversation on WSJ Marketbeat.
The Motley Fool CAPS data suggests that investors believe Kraft Foods, Incorporated Class A will beat the market in the foreseeable future. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, KFT has been less covered in the news compared to the rest of our universe of stocks. We consider KFT as Undervalued at the current price of $28.15. According to our methodology, this stock has appreciation potential based on current fundamentals which only improves if earnings or revenue surprise.
“… 11, 2010 Ratings: Aa2 (Moody’s Investors Service) AA+ (Standard & Poor’s) Prices for KRAFT, from its regulatory filing, were as follows: ... …”
Stocks to Watch: KFT Heavily Covered on WSJ Marketbeat
We are observing a lot of attention being paid to KFT in the news, so if you hold the stock you may want to take a look at what is going on.
Based on our methodology, Kraft Foods, Incorporated Class A should hold some appeal to value investors as we view it as Undervalued. We noticed recently that in comparison to all other stocks we analyze in the news; KFT has received less coverage from the financial media in business television and blogs. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey.
“… 8, 2010 Ratings: Baa2 (Moody’s Investors Service) BBB (Standard & Poor’s) KRAFT, which didn’t get an official nod from shareholder Berkshire ... …”
Zero Hedge: Is Kraft Foods, Incorporated Class A Able to Constrain Costs?
KFT costs were discussed on Zero Hedge, and may be of interest to investors.
Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. At present, Ockham has a valuation stance of Undervalued on KFT, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Kraft Foods, Incorporated Class A has actually sunk a bit in comparison to the others.
“… KRAFT, Berkshire raise $17. 5B for acquisitions. MF Global Hldgs reported its fourth consecutive quarterly loss, at $27. 9M. Revs down 41%. …”
Income Investors: A Discussion of KFT and Dividends on Zero Hedge
If KFT's dividends are important to you, take a look at the news as they were the topic of conversation on Zero Hedge.
The Motley Fool CAPS data suggests that investors believe Kraft Foods, Incorporated Class A will beat the market in the foreseeable future. We consider KFT as Undervalued at the current price of $28.39. According to our methodology, this stock has appreciation potential based on current fundamentals which only improves if earnings or revenue surprise. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, KFT has been less covered in the news compared to the rest of our universe of stocks.
“… The names having the largest impact on IG are KRAFT FOODS Inc. (-3bps) pushing IG 0. 02bps tighter, and International Lease Finance Corp. (+58. 27bps) adding 0. 4bps to IG. …”
Investors Sentiment's Effect on Kraft Foods, Incorporated Class A on Zero Hedge
Sentiment and investors' opinions on KFT were covered on Zero Hedge recently and RazorWire has captured the news segment.
Based on our methodology, Kraft Foods, Incorporated Class A should hold some appeal to value investors as we view it as Undervalued. We noticed recently that in comparison to all other stocks we analyze in the news; KFT has received less coverage from the financial media in business television and blogs. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey.
“… 21%) in the wideners, and KRAFT FOODS Inc. (-3. 77%), Sara Lee Corp. (-0. 93%), and XTO Energy Inc (-0. 68%) in the tighteners. …”
Kraft Foods, Incorporated Class A Talked About Near M&A Discussion on WSJ Marketbeat
RazorWire captured a discussion on WSJ Marketbeat that contained talk of M&A activity and KFT was mentioned as well.
Based on our methodology, Kraft Foods, Incorporated Class A should hold some appeal to value investors as we view it as Undervalued. We noticed recently that in comparison to all other stocks we analyze in the news; KFT has received less coverage from the financial media in business television and blogs. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey.
“… On Thursday, debt investors gorged on candy and conglomerates as KRAFT and Berkshire Hathaway successfully sold a combined $17. 5 billion in investment-grade debt. …”
The Latest News for KFT Was Just on WSJ Marketbeat
The latest news from business television and influential blogs is always available through Ockham's RazorWire, and this news is in relation to Kraft Foods, Incorporated Class A.
When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Kraft Foods, Incorporated Class A has actually sunk a bit in comparison to the others. At present, Ockham has a valuation stance of Undervalued on KFT, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey.
“… KRAFT offered notes maturing in 3. 25, six, 10 and 30 years. But the skittish equity market action on Thursday caused a few last-minute hiccups to the pricing, with KRAFT ... …”
Kraft Foods, Incorporated Class A Talked About Near M&A Discussion on Zero Hedge
RazorWire captured a discussion on Zero Hedge that contained talk of M&A activity and KFT was mentioned as well.
Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. At Ockham, we rank each stock by the amount of news coverage we see from RazorWire news analytics, and Kraft Foods, Incorporated Class A has not seen a major ranking change recently. At present, Ockham has a valuation stance of Undervalued on KFT, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue.
“… 5 billion from KRAFT to finance its Cadbury purchase. We have yet to see if the massive corporate supply will be easily absorbed. …”
Merger Talk with KFT on Seeking Alpha Wall St Breakfast
News broke today regarding mergers and acquisitions and Kraft Foods, Incorporated Class A was discussed as well on Seeking Alpha Wall St Breakfast. Other sources will be required to know exactly what the context was in the discussion.
At present, Ockham has a valuation stance of Undervalued on KFT, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Kraft Foods, Incorporated Class A has actually sunk a bit in comparison to the others. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey.
“… KRAFT crafts bond offer. KRAFT (KFT) is reportedly planning to sell at least $4B in bonds in four parts today to help it finance its Cadbury (CBY) acquisition. …”