The Kraft Heinz Company (KHC) DCF Valuation
TGM's two-stage DCF values The Kraft Heinz Company (KHC) between $24.83 and $58.15 depending on assumptions, with a base case of $36.11. Growth is taken from the company's own record (blend of 5-year revenue and FCF growth (floored at 2%)), fading to 2.5% long-run; the discount rate (7.5%) reflects its beta.
What would today's price require?
$24.39 is justified only if free cash flow grows about -3.8% a year (fading to 2.5% long-run) at a 7.5% required return — about in line with its track record.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 0.5%/yr | 8.5% | $24.83 |
| Base case | 2.0%/yr | 7.5% | $36.11 |
| Optimistic | 5.0%/yr | 6.5% | $58.15 |
| Analyst DCF (FMP) | independent reference — different model | $27.67 | |
Current Price
$24.39
Market-Implied Growth
-3.8%/yr
vs -4.0% 5Y actual
Model Scenario Range
$24.83 – $58.15
model output — not a price target
KHC DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for KHC (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $3.1B · 1.19B shares · net debt $18.6B
Estimated Fair Value
$35.18
+44.2% vs $24.39
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 2.0%/yr FCF growth and 10-year horizon fixed. Green = above today's $24.39; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 5.5% | $52.61 | $59.55 | $68.81 | $81.77 | $101 |
| 6.5% | $38.86 | $42.83 | $47.79 | $54.17 | $62.67 |
| 7.5% | $29.71 | $32.19 | $35.18 | $38.82 | $43.38 |
| 8.5% | $23.17 | $24.83 | $26.76 | $29.05 | $31.80 |
| 9.5% | $18.27 | $19.42 | $20.75 | $22.28 | $24.06 |
About The Kraft Heinz Company
The Kraft Heinz Company, along with its subsidiaries, operates as a global entity focused on the manufacturing and marketing of a broad spectrum of food and beverage products. Its reach extends across key markets such as the United States, Canada, and the United Kingdom, as well as numerous other international territories. The company's diverse product offerings include popular condiments and sauces, a variety of cheese and dairy items, prepared meals, meat products, and refreshing beverages. Additionally, its portfolio features coffee, an assortment of healthy snacks, salad dressings, various spices and seasonings, and a range of other general grocery staples. Kraft Heinz employs a multi-faceted distribution strategy. It utilizes its internal sales organizations alongside independent brokers, agents, and third-party distributors to reach a wide array of customers. These include large grocery chains, wholesale providers, cooperative and independent grocers, convenience stores, pharmacies, value stores, bakeries, mass merchandisers, and club stores. Furthermore, the company supplies products to the foodservice sector and institutional clients, such as hotels, restaurants, hospitals, healthcare facilities, and government agencies. A significant portion of its sales also occurs online through various e-commerce platforms and digital retailers. Tracing its origins back to its founding in 1869, the company initially operated as H.J. Heinz Holding Corporation before officially changing its name to The Kraft Heinz Company in July 2015. Its corporate headquarters are located in Pittsburgh, Pennsylvania.
- Sector
- Consumer Defensive
- Industry
- Packaged Foods
- CEO
- Steven A. Cahillane