3Mês·

I received the dividend from $KHC and I'm thinking about selling 🟠

I just received my dividend from Kraft Heinz $KHC (+6,81%) —a juicy 6.97% yield. And I’m seriously considering selling.

Sounds contradictory, doesn’t it? Why sell something that pays you 7%?

Because my algorithm flags it as 🟠 CAUTION (Quality 40, Opportunity 60). The dividend is covered for now (the payout-to-cash-flow ratio is only 39.9%), but the business has deep-seated problems:

• $9.300M in impairment losses last year—they’re constantly writing down the value of their own brands

• Revenue has been been flat for a decade (CAGR -0.5%)

• $19.000M in debt that blocks any restructuring

• Growing legal risk from litigation over ultra-processed foods

A 7% return means nothing if the business is slowly eroding from within.

Sometimes the best decision regarding a dividend is knowing when to let it go. I haven’t sold yet. But I’m watching it very closely.

26.06

Kraft Heinz

Recebidos Dividendos em US$ 0,40

2 Comentários

Poor Dad@PoorDad

3Mês

I sold GIS as well, but mainly because I think other companies treat their investors better. A lot of wellknown investors also say that Kraft Heinz doesn’t seem to like its shareholders. 😂

•

Kini - Dividend Strategy@investron

3Mês

@PoorDad I just checked $GIS through the algorithm and it's the opposite story from $KHC. General Mills is in 🟢 OPTIMAL (Quality 65, Opportunity 85). P/E of just 8.76x, a 7% yield, and the cash flow payout ratio is at 59%. Though I'll admit, a 65 Quality score is a barely passing grade.

The algorithm thinks the market is overreacting to the GLP-1 fears and synthetic dye bans. Its estimated fair value is $45-55, vs the current $35.

That said, if you sold because you don't like how they treat shareholders, that's a totally valid reason, also not top quality

••