Kraft Heinz (NASDAQ:KHC) has seen its stock downgraded by Bank of America and Citi after poor results and a disappointing outlook.

The company posted a fourth straight quarter of missed sales targets, with net sales down 4.1% to $6.6bn in the three months to 28 December, as higher prices pushed shoppers away to cheaper alternatives. Sales for the full year were down 3% to $25.8bn.

The company forecasts revenue will fall by up to 2.5% in 2025 while the profit outlook is lower than expectations. This does not account for the potential impact of a tariff war or stricter food regulations, the company said.

BofA double-downgraded the stock from Buy to Underperform and cut the price target from $36 to $30, arguing that Kraft Heinz continues to struggle with organic sales growth. 

“We struggle to see a path forward to meaningful organic sales improvement over the next 12 months,” the firm stated, pointing to declining volumes in key product categories such as condiments, mac & cheese, and Lunchables. Citi also downgraded Kraft Heinz, moving the stock to Neutral from Buy and reducing its price target from $34 to $28. 

The bank’s analysts expressed skepticism over the company’s ability to achieve its long-term growth targets, particularly given its limited planned investments in marketing and promotions. 

“The company’s 2025 sales and earnings outlook disappointed,” said Citi. “We are not sure that the outlook is fully de-risked.” 

Both banks lowered their earnings estimates, with BofA cutting its 2025 EPS forecast from $2.97 to $2.65, while Citi reduced its projection from $2.97 to $2.68. Analysts warned that additional investment may be necessary in 2026 to reignite growth, potentially keeping earnings under pressure.

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