10 Best Chocolate Stocks to Buy Now

2. The Kraft Heinz Company (NASDAQ:KHC)

Number of Hedge Fund Holders: 43

The Kraft Heinz Company (NASDAQ:KHC) is a global food and beverage leader, offering products like condiments, sauces, cheese, and beverages. One of its long-standing brands is Baker’s, a trusted name in baking chocolate. Baker’s remains a key player in Kraft Heinz’s diverse portfolio, serving both home bakers and professionals with high-quality baking products.

In Q2 2024, The Kraft Heinz Company (NASDAQ:KHC) reported a 3.6% decline in net sales to $6.5 billion, primarily due to foreign currency impacts and divestitures. The Retail segment, which includes brands such as Baker’s, experienced mixed performance, with a 1.0% price increase in key areas like North America and Emerging Markets, helping to offset higher input costs. However, volume/mix declined by 3.4% due to weaker consumer sentiment. Despite these challenges, adjusted operating income rose by 2.0% due to cost reductions, and adjusted EPS of $0.78 surpassed analysts’ expectations of $0.734.

Meanwhile, net cash from operating activities rose by 8.1%, driven by improvements in working capital, and free cash flow increased by 8.7% to $1.2 billion in the first half of 2024. Despite increased capital expenditures, The Kraft Heinz Company (NASDAQ:KHC) returned value to shareholders by paying $969 million in dividends and repurchasing $537 million in stock during the first half of 2024, which makes KHC one of the best chocolate stocks on our list.

On August 2, Kraft Heinz announced a partnership with Major League Baseball’s Chicago Cubs, making HEINZ the official condiment of Wrigley Field, providing flavor-enhancing products in the stadium. The goal is to boost brand visibility and offer fans unique food experiences, including a Kraft Mac & Cheese stand on Kids’ Sundays.

The recent 2.53% price increase over the past month can be attributed to a combination of strategic pricing actions and cost management efforts. However, YTD movement was -3.77%, largely due to weaker consumer demand, volume/mix declines, and foreign currency impacts. Still, the company’s focus on improving operating efficiency and repurchasing shares is likely to boost investor confidence going forward.

Hence, analysts have projected an upside potential of 5.95%, and as of Q2 2024, 43 hedge funds, holding a combined investment of $11.0 billion, remained bullish on the stock, as per Insider Monkey’s database.