Could This Be a Red Flag for Kraft Heinz Stock and Its Dividend?
Kraft Heinz (NASDAQ: KHC) is an attractive dividend stock for investors. It offers a high yield of 4.4%, which is more than three times the S 500 average of 1.4%. But the business hasn't been growing all that much, and with its high debt load and interest rates remaining elevated, investors haven't been keen on owning the stock in recent years.
Concerns may be rising that Kraft may not be able to maintain its current dividend for the long haul. It has already slashed its dividend payment in the past. Now, with a rumor circulating that Kraft may be looking to offload one of its businesses, could that be a red flag for investors?
According to a recent report from The Wall Street Journal, Kraft is exploring the possibility of selling one of its top brands in Oscar Mayer. A deal for the business could generate between $3 billion and $5 billion for Kraft. The company hasn't indicated any such move in its recent filings. It also doesn't break out revenue and earnings by brand, so it's not clear how strongly it may have been performing of late, and whether that could be part of the motivation to sell the brand.
Source Fool.com
