Top Warren Buffett stocks Kraft Heinz (KHC) and Coca-Cola (KO) soared on earnings beats this week, with the consumer staples giants benefiting from price hikes.
Defying investor worries about inflation’s impact on shoppers, the consumer staples giants signaled strong demand for now. Meanwhile, price hikes to manage rising supply-chain and commodity costs helped both companies, offsetting a strong dollar.
“In the face of these pressures, consumers stayed resilient,” Coca-Cola CEO James Quincey said on an earnings call with investors.
IBD Live: A New Tool For Daily Stock Market Analysis
Top Warren Buffett Stocks
Both KHC stock and KO stock are among the top 5 stocks by number of shares in the Berkshire Hathaway (BRKB) investment portfolio. Both are also among the top 10 stocks in the portfolio by market value, with Apple (AAPL) at No. 1.
For the September quarter, Coca-Cola earned 69 cents per share on revenue of $11.063 billion, the company said on Oct. 25. Year over year, Cola-Cola earnings rose 7% and sales grew 10%. Both beat estimates.
For the third quarter, Kraft Heinz earned 63 cents per share on revenue of $6.505 billion, the company reported Oct. 26. On a year-over-basis, Kraft Heinz earnings fell 3% while revenue rebounded 4%. Both also beat estimates.
Despite currency, inflationary and macro headwinds, Kraft Heinz affirmed 2022 sales guidance of high-single-digit growth and raised the lower end of its full-year earnings guidance.
Coca-Cola hiked its forecast for revenue and profit growth this year and said it is “encouraged by the underlying top-line momentum” for 2023.
Analysts expect Kraft Heinz to return to annual EPS growth in 2023 after a decline this year, but still below the 2021 level. Some investors think the Kraft Heinz turnaround is gaining momentum roughly seven years after food giants Kraft and Heinz merged.
KO Stock, KHC Stock
Cola-Cola stock jumped 8.6% this past week to 60.76. The powerful move sent shares above the 10-week moving average but they remain below the 40-week line. KO stock is forming a double-bottom base with a…