Back in February Warren Buffett complained that his Berkshire Hathaway Inc overpaid for merger that created Kraft Heinz Co .
With Airlines being his biggest fall this March, looks like Kraft Heinz stocks (KHC) are going down as well. At least if we are going to trust the latest report price target from Berenberg.
1.Ketchup sales will suffer as out-of-home consumption falls sharply in March and April.
2. Supply chain issues as more countries are closing their borders.
This is a 3rd blow for Kraft Heinz in only 2 months, the first blow being a $15.4 billion writedown which caused Berkshire Hathaway to lose $4.3 billion on its stake (a 26.7% stake in Kraft Heinz).
On the other side Jonathan Weber argues that Kraft Heinz looks like a solid defensive pick as its center-aisle products are seeing additional demand during the current crisis.
And according to the latest news from CNBC “KHC was upgraded to “overweight” from “neutral” at JPMorgan Chase, which said that packaged food companies with higher levels of debt will benefit from the virus-related surge in business.”
Who will be right and who will be wrong time will show. But we all know that Warren Buffett is a long term investor.