Kraft Heinz: Running With Scissors?

From a reader taking extra measures — for good reason:

“Taping over the laptop camera is not paranoid but smart.

“I’ve received several of those mass blackmail emails in the past couple months so obviously my information was compromised on somebody’s server. I know it’s false but they do have an old password to ‘prove’ their ability, so it’s unnerving to get these things.

“Included in all the nasty threats is a claim they’ve gained control of my computer’s camera and have videos of me. At which point I can say, wait a minute, my laptop doesn’t even have a camera and, on my old one, I always kept the camera taped over.

“So it’s a bit of comfort in a world full of creeps.”

A reader accuses The Rundown of Trump bashing:

“I do not see how I can trust your advice when your politics are disparaging of my president and totally wrong.

“Why not talk finances and stay out of politics? I do know for sure that you are quite wrong about President Trump. We the American people elected him and when you disrespect him, you disrespect us.

“That is not a good thing to get in the habit of doing. Just saying.”

Not making a habit of voicing political opinions; just creating a forum for the opinions of readers.

Your Rundown for Tuesday, March 5, 2019:

Running With Scissors

One of the jaw-dropping earnings reports so far this season has been the consumer staple company Kraft Heinz (KHC).

Once ubiquitous in American kitchens, the company known for its ketchup and processed cheese has grown stale. And fallen out of favor.

chart

But investors shouldn’t have been taken off-guard by slow (and low) growth and decreasing margins. The most recent earnings report has been years in the making as you can see from the chart.

One justification investors have made in favor of KHC stock — that dropped a record-breaking 25% on Feb. 22 — is that it’s a conservative value investment, offering high dividend yields. Generally, higher than what you would earn on treasuries or even healthy corporate bonds.

The thing to keep in mind about all dividend stocks is they’re not bonds. Companies like Kraft Heinz aren’t obligated to pay dividend to investors; in fact, they can cut or suspend dividends at will.

So what should you do if you already own Kraft Heinz stock? Since the damage is already done, selling is probably not the best course of action. Hold for now.

“The good news is that…Kraft Heinz has a value ($34.88) that is close to the stock price ($33.23),” says a post at website Musings on Markets. “The bad news is that the potential upside looks limited.”

Market Rundown for Tues. March 5, 2019

S&P 500 futures are up 6 points to 2,787.02.

Oil is up 25 cents to $56.84 per barrel.

Gold is down 70 cents to $1,286.80.

Bitcoin is up $115.06 to $3,846.34.

Have a good day. We’ll talk tomorrow.

For the Rundown,

Aaron Gentzler

Aaron Gentzler

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Aaron Gentzler

Aaron Gentzler is the publisher of Seven Figure Publishing. He is also the editor of The Rundown and has been with Agora Financial / Seven Figure Publishing since 2005. He's been covering technology and markets for over a decade.

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