Kraft Heinz has picked a new CEO ahead of a business split. What about the stock?

Kraft Heinz, which owns food brands such as Oscar Mayer and Kraft Heinz, announced that former Kellanova snack maker CEO Steve Cahillane will become its CEO on January 1, 2026. This position he will take before the planned division of the company, writes CNBC.

Kraft Heinz has decided to split its businesses into two public companies in September 2025 after several years of declining sales, higher product prices and rising costs due to import duties, Reuters notes. The company expects the separation to take place in the second half of 2026.

- Afterward, Kraft Heinz expects Cahillane to become head of a business called Global Taste Elevation, which will include high-growth brands. These include Heinz (ketchup and sauces), Philadelphia (cream cheese) and Kraft Mac & Cheese (macaroni and cheese). This Kraft Heinz business had revenues of about $15.4 billion in 2024.

- The second company has been given the temporary name North American Grocery. It will combine the Oscar Mayer (sausages and hot dogs), Kraft Singles (processed cheese slices) and Lunchables (ready-to-eat snack kits) brands. This is a division with annual revenues of about $10 billion by the end of 2024.

Previously, the company had planned for the business to be led by current Kraft Heinz CEO Carlos Abrams-Rivera. However, the company has now said that he will serve in an advisory role at the divided Kraft Heinz until March 6, 2026. Abrams-Rivera has served as CEO of the food giant since 2024, CNBC points out. Who will lead North American Grocery is not yet known. The search will soon be handled by the Kraft Heinz board of directors.

Cahillane, 60, previously headed breakfast cereal maker Kellogg. His leadership period also came at the time of Kellogg's 2023 demerger. The company then spun off its slow-growing North American breakfast cereal business, WK Kellogg, into a separate firm, and focused on its snacks segment, which was later renamed Kellanova. Cahillane remained head of Kellanova until its sale to Mars for $35.9 billion (the deal was finalized last week). He also worked at Coca-Cola and at major beer maker AB InBev.

"The move [Cahillane's appointment] increases investor speculation that the Global Taste Elevation unit could be a deal target," said Jefferies analyst Scott Marks.

Experts also noted that Cahillane - given his roughly 30 years of experience in consumer goods - was appointed to Kraft Heinz to accelerate the recovery of the company, which has failed to regain sales growth in recent years and has lost ground to competitors, Reuters wrote. "I've spent my entire career building brands, and the opportunity to do the same with the iconic Kraft Heinz portfolio is a dream come true," Cahillane said.

Kraft Heinz shares were up 0.9% in trading on Dec. 16. Overall, the company's securities have lost about 75% from their 2017 peak and are down nearly 30% since Carlos Abrams-Rivera took over the company in January 2024, Reuters notes.

The forecasted price/profit ratio (forward P/E), one of the key indicators of fair value estimation of the company's securities, is 9.73, the agency notes. For comparison, at PepsiCo this indicator is 17.67, at Coca-Cola - 22.04, and at Mondelez - 17.21, follows from the data of LSEG, cited by Reuters.

Of the 20 analysts watching Kraft Heinz stock, 18 advise holding it in a portfolio. One each advises buying and selling them.

This article was AI-translated and verified by a human editor