Is Kraft Heinz's Dividend Safe?
Dividend stocks can provide investors with a great source of recurring income. But if those payouts aren't safe, there's a risk that the Dividend could end up getting cut or eliminated entirely. If that happens, the stock price could also fall drastically, especially if the Dividend was the primary reason for investing in the company.
That's the main motivation for investing in consumer goods giant Kraft Heinz (NASDAQ: KHC). The stock's 4.6% dividend yield is more than 3 times higher than the S 500 average yield of just under 1.4%. Investors can get a lot of bang for their buck when it comes to dividends. But there's a problem: Kraft's profits plunged last quarter. Is the dividend still safe?
On Feb. 14, Kraft reported its fourth-quarter results for the last three months of 2023. Net sales of $6.9 billion were down by 7.1% on a year-over-year basis. And for the full year, the top line only rose by 0.6%. The food company has been able to rely on rising prices to help offset the effect of inflation, but customers have been pushing back, so volumes were down 4.4% in Q4.
Source Fool.com
