RBC Is Bullish on Kraft Heinz Stock and Expects Growth to Return in 2027

Kraft Heinz (KHC) has not been a story of growth in recent years. Volumes are down, revenues are under pressure, and the stock is trading below its 52-week high price. However, according to RBC Capital Markets, it appears that investors might have overlooked what lies ahead.

RBC recently initiated its coverage of Kraft Heinz with a price target of $32 and an "Outperform" rating. Analyst Nik Modi forecasts that the packaged food giant will start organic growth in 2027 when its organic revenue growth is estimated to reach 0.9% versus the consensus estimate of 0.4%. The thesis is partially driven by approximately $700 million of additional investments into pricing, innovation, and marketing in 2026. As a result, 2027 will be the test year for Kraft Heinz: the company has to show that increasing investment into its brands can lead to higher volumes and growth of revenues.

Headquartered in both Pittsburgh and Chicago, The Kraft Heinz Company is one of the largest producers of packaged foods and beverages in the world. The company's brand list includes Heinz, Kraft, Philadelphia, Lunchables, Capri Sun, and Oscar Mayer. Currently, the market capitalization of Kraft Heinz is about $29 billion.

KHC stock is trading around $24, having a 52-week price range from $21.03 to $28.09. The stock is approximately 13% below its 52-week high price despite recovering around 16% since its low, and it lags the S&P 500 Index ($SPX), which is still in the green for 2026.

The valuation is one of the elements of RBC's thesis that stands out. The current multiple of KHC is approximately 11.9 times of forward earnings and 1.16 times of sales. Moreover, KHC's forward P/E ratio is below several previous highs of the stock reached this decade. This suggests that investors are currently not paying a lot for the growth. It makes sense given the weakness in the volumes but becomes more interesting if RBC turns out to be correct.

Another element of the story is income. Kraft Heinz distributes a quarterly dividend of $0.40 per share ($1.60 annually); that means the current forward yield is about 6.5%. The most recent declared dividend payment date is Sept. 25.