Kraft Heinz KHC FAIRLY VALUED Buying Index™ 3 Value Rating

Valuentum Retail Equity Research Ratings as of 9-Apr-2022 Data as of 7-Apr-2022

Buying Index™ 6 Value RatingEconomic Castle

Neutral

Investment ConsiderationsDCF ValuationRelative Valuation

Stock Chart (weekly) ValueCreation™ValueRisk™ValueTrend™Cash Flow GenerationFinancial LeverageGrowthTechnical EvaluationRelative StrengthMoney Flow Index (MFI)Upside/Downside Volume (U/D)Near-term Technical Support, 10-week MADCF = Discounted Cash Flow; MFI, U/D = Please see glossary. MA = Moving Average

Business Quality ValueCreation™

ValueRisk™ Very Poor Poor Good ExcellentCompany Vitals Investment HighlightsMarket Cap (USD) $49,489Avg Weekly Vol (30 wks) 32,50830-week Range (USD) 32.79 - 41.99Valuentum Sector Consumer Staples5-week Return 6.6%13-week Return 5.5%30-week Return 10.1%Dividend Yield % 4.0% Firms that generate economic profits with little operating variability score near the top right of the matrix.

Dividends per Share 1.60 Relative Valuation Forward P/E PEG Price / FV

Forward Dividend Payout Ratio 60.2% Coca-Cola 25.4 5.2 137.3%Est. Normal Diluted EPS 2.76 Philip Morris 16.5 3.6 99.5%P/E on Est. Normal Diluted EPS 14.5 Procter & Gamble 26.6 3.6 131.1%Est. Normal EBITDA 7,348 Wal-Mart 22.8 2.0 113.5%Forward EV/EBITDA 9.5 Peer Median 24.1 3.6 122.3%EV/Est. Normal EBITDA 9.2 Kraft Heinz NMF 1.7 105.4%Forward Revenue Growth (5-yr) 1.0% Price / FV = Current Stock Price divided by Estimated Fair Value

Forward EPS Growth (5-yr) 28.0% Financial Summary ProjectedNMF = Not Meaningful; Est. = Estimated; FY = Fiscal Year

Fiscal Year End: Dec-20 Dec-21 Dec-22

Returns Summary 3-year Historical Average Revenue 26,185 26,042 24,974Return on Equity 2.2% Revenue, YoY% 4.8% -0.5% -4.1%Return on Assets 1.1% Operating Income 5,527 5,094 6,239ROIC, with goodwill 7.7% Operating Margin % 21.1% 19.6% 25.0%ROIC, without goodwill 12.6% Net Income 356 1,012 3,300ROIC = Return on Invested Capital; NMF = Not Meaningful Net Income Margin % 1.4% 3.9% 13.2%Leverage, Coverage, and Liquidity Diluted EPS 0.29 0.82 2.66In Millions of USD Diluted EPS, YoY % NMF NMF NMFTotal Debt 21,815 Free Cash Flow (CFO-capex) 4,333 4,489 3,270Net Debt 18,370 Free Cash Flow Margin % 16.5% 17.2% 13.1%Total Debt/EBITDA 3.6 In Millions of USD (except for per share items)

Net Debt/EBITDA 3.1 LARGE-CEBITDA/Interest 2.9 NEUTRALCurrent Ratio 1.0Quick Ratio 0.4

• Following the 2015 merger, Kraft Heinz was focusedon cost cutting, perhaps at the expense of maintainingbrand equity, a notion supported by the variousimpairment charges recorded over the following fiscalyears. Cost saving initiatives are ongoing.

NMF = Not Meaningful

The information and data contained in this report is not represented or warranted to be timely, complete, accurate, or correct. This report is for informational purposes only and should not be considered a solicitation to buy or sell a security. Before acting on any information in this report, you should consider whether the information is suitable for your particular circumstances and, if necessary, seek professional advice. Assumptions, opinions, and estimates are based on our judgment as of the date of the report and are subject to change without notice. Valuentum is not responsible for any errors or omissions or for results obtained from the use of this report. Redistribution is prohibited without written permission. To license Valuentum research, contact us at [email protected].

Structure of the Food Products IndustryThe food products industry is composed of a number of firms with strong brand names. However, market supply/demand dynamics and intense competition still impact product prices, while fluctuations in commodity costs can make earnings quite volatile. Private-label competition, competitors' promotional spending, and changing consumer preferences often drive demand trends. The group's customers—such as supermarkets, warehouses, and food distributors—continue to consolidate, increasing buying power over constituents and hurting margins. Still, we’re generally neutral on the group.

• Kraft Heinz aims to grow its e-commerce sales goingforward by improving its logistical capabilities,upgrading its marketing campaigns with a focus ondigital investments, and taking advantage of thecompany’s scale.

• In fiscal 2021, Kraft Heinz completed the sale of alarge chunk of its cheese business to the French firmGroupe Lactalis for ~$3.3 billion in totalconsiderations (including ~$3.2 billion in cash) and itsPlanters snack nut business for ~$3.35 billion in cashto Hormel Foods. Kraft Heinz retains a smaller cheesebusiness in the US and abroad.

----- Actual -----

• Products of Kraft Heinz can be found in 95+% of UShouseholds and North America remains its keygeographical market. Going forward, Kraft Heinz aimsto grow its international sales with an eye towardssauces, meats, coffee, and beverages. These categorieshave promising long-term growth outlooks.

Medium 1High

Low• Kraft Heinz boasts an impressive portfolio of globalbrands after Kraft Foods Group merged with H. J.Heinz Company in 2015. About 80% of Kraft Heinz’snet sales come from the US and Canada, and some ofits key brands include Kraft, Heinz, Oscar Meyer,Kool-Aid, and Jell-O. Kraft Heinz is headquartered inPittsburg, Pennsylvania. Very High

BULLISHSTRONG

NEUTRALBULLISH

39.00

The week with the highest trading volume out of the last 30 weeks was a week of heavy selling, or distribution (red bar).

GOODMEDIUM

POSITIVESTRONG

HIGHMODEST

Kraft Heinz is leaning on its pricing power to offset inflationary pressures, though the firm will need to revive its revenue growth trajectory to meaningfully improve its outlook.

FAIRLY VALUEDNEUTRAL

Industry $38.00 $29.00 - $48.00 LARGE-CAP CORE Consumer Staples Recession Resistant

Visit us at www.valuentum.com

Kraft Heinz KHC FAIRLY VALUED Estimated Fair Value Fair Value Range Investment Style Sector

28.00

30.00

32.00

34.00

36.00

38.00

40.00

42.00

44.00

0

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

Page 1

Valuentum Retail Equity Research (10=best) Data as of 7-Apr-2022


Neutral

Economic Profit Analysis

ValueCreation™ GOOD Return on Invested Capital (ROIC)

ROIC - WACC Spread, 3-year historical average 3.0%ROIC - WACC Spread, 5-year projected average 1.0%These spreads equal the firm's annual average ROIC (excluding goodwill) less its WACC.

ValueTrend™ POSITIVE

Weighted Average Cost of Capital (WACC) The graph above shows the firm's ROIC (excluding goodwill) compared with historical averages and its WACC.

ROIC CalculationFiscal Year End: Dec-19 Dec-20 Dec-21

Earnings before InterestOperating Income after Depreciation 4,969 5,527 5,094- Adjusted Taxes (at 21% of EBIT) 1,043 1,161 1,070+ Amortization 0 0 0+ Non-cash Operating Items 625 3,599 3,460- Minority Interest -2 5 12Earnings before Interest 4,553 7,960 7,472

Cost of Equity Invested CapitalRisk Free Rate Assumption Inventories 2,721 2,554 0Fundamental Beta (ERP multiplier) + Receivables 2,146 2,063 0Estimated Equity Risk Premium + Current Deferred Income Taxes 0 0 0Cost of Equity Assumption + Other Current Assets 951 2,788 5,549

+ Property, Plant and Equipment, Net 7,055 6,876 6,806After-tax Cost of Debt + Goodwill, Net (Cost in Excess) 35,546 33,089 31,296Risk Free Rate Assumption + Intangibles 48,652 46,667 43,542Synthetic Credit Spread + Non Current Deferred Income Taxes 0 0 0Cost of Debt Assumption - Accounts Payable 4,387 4,662 0Cash Tax Rate Assumption - Other Current Liabilities 647 946 0After-tax Cost of Debt Assumption

Invested Capital, with goodwill 92,037 88,429 87,193Cost of Preferred Stock Invested Capital, without goodwill 56,491 55,340 55,897Preferred DividendsValue of Preferred Stock Return on Invested Capital, with goodwill 4.9% 9.0% 9.1%Cost of Preferred Assumption Return on Invested Capital, without goodwill 8.1% 14.8% 14.8%

In Millions of USD

Weighted Average Cost of Capital (WACC)ERP = Equity Risk Premium

Note: Valuentum may provide an adjusted ROIC measure to better reflect the economic substance of a company's operations, as in the case of companies with negative invested capital.


21.0%5.8%

00

NA

9.6%

1.26.5%

11.8%

4.3%3.00%

7.3%

Kraft Heinz receives a ValueTrend™ rating of POSITIVE, which is based on thecompany's trailing three-year performance. The firm's ROIC (excluding goodwill)increased to 14.8% last year from its trailing 3-year average of 12.6%. We expect ROIC(excluding goodwill) to be in the ballpark of about 11% by the end of our discreteforecast period, with upside potential to about 18% over that time period.

---------- Actual ----------

4.3%

$38.00 $29.00 - $48.00 LARGE-CAP CORE Consumer Staples Recession Resistant

The best measure of a firm's ability to create value for shareholders is expressed bycomparing its return on invested capital (ROIC) with its weighted average cost ofcapital (WACC). The gap or difference between ROIC and WACC is called the firm'seconomic profit spread. Kraft Heinz's 3-year historical return on invested capital(without goodwill) is 12.6%, which is above the estimate of its cost of capital of 9.6%.As such, we assign the firm a ValueCreation™ rating of GOOD. In the chart to theright, we show the probable path of ROIC in the years ahead based on the estimatedvolatility of key drivers behind the measure. The solid grey line reflects the most likelyoutcome, in our opinion, and represents the scenario that results in our fair valueestimate. On the prospect of improving fundamentals, we give Kraft Heinz a neutralEconomic Castle rating.

Kraft Heinz KHC FAIRLY VALUED Estimated Fair Value Fair Value Range Investment Style Sector Industry

17.6%

10.8%

8.1%

14.8% 14.8%

4.1%

WACC, 9.6%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

20.0%

69.4%

30.6%

Equity

Debt

Preferred

Capital Structure

Page 2



Neutral

Growth Analysis

Revenue Growth MODEST Projected Revenue (in millions of USD) Source: Company Filings, Valuentum Projections

Last Fiscal Year

Revenue3-year Historical

CAGR5-year Projected

CAGRKraft Heinz USD 26,042 -0.3% 1.0%

Coca-Cola USD 38,655 6.7% 5.7%

Philip Morris USD 31,405 2.0% 3.1%

Procter & Gamble USD 76,118 4.4% 4.7%

Wal-Mart USD 572,754 3.6% 3.2%

Peer Median 4.0% 3.9%

Industry Median 4.1% 3.8%

In the chart above, we show our baseline forecast for revenue as well as potential upside and downside cases.

EBITDA Growth Projected EBITDA (in millions of USD) Source: Company Filings, Valuentum Projections

Last Fiscal Year

EBITDA3-year Historical

CAGR5-year Projected

CAGRKraft Heinz USD 6,004 -3.7% 4.6%

Coca-Cola USD 12,606 5.1% 9.3%



Wal-Mart USD 36,600 3.9% 6.2%



In the chart above, we show our baseline forecast for EBITDA as well as potential upside and downside cases.

Net Income Growth Projected Net Income (in millions of USD) Source: Company Filings, Valuentum Projections

Last Fiscal Year Net Income

3-year Historical CAGR

5-year Projected CAGR

Kraft Heinz USD 1,012 -146.3% 28.6%

Coca-Cola USD 9,771 14.9% 5.5%



Wal-Mart USD 13,673 27.0% 14.5%



In the chart above, we show our baseline forecast for net income as well as potential upside and downside cases.

Kraft Heinz's EBITDA expansion has trailed both that of its peer group and its industrygroup during the past three years. We expect the firm's pace of EBITDA growth to fallbelow that of both its peer group and industry group during the next five years. Coca-Cola sports the highest expected EBITDA growth rate among peers.

Kraft Heinz's net income expansion has trailed both that of its peer group and itsindustry group during the past three years. We expect the firm's net income expansionto outpace its peer group and industry group during the next five years. Kraft Heinzsports the highest expected net income growth rate among peers.



Kraft Heinz's revenue expansion has trailed the median of both its peer group and itsindustry group during the past three years. We expect the firm's pace of revenue growthto fall below the median of both its peer group and industry group during the next fiveyears. Our growth assessment of each firm is based on the firm's 5-year forwardrevenue CAGR. Kraft Heinz's future pace of revenue growth is MODEST, in ouropinion.


24,97726,185 26,042

28,769

27,39926,029

0

5,000

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5,9636,496

6,004

8,287

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6,780

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1,935

356

1,012

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3,5663,209

0

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Neutral

Cash Flow and Financial Leverage AnalysisCash Flow Generation STRONG Financial Leverage HIGH

The bars above show the firms operating cash flow, capital expenditures, and free cash flow, respectively. The bars above show the firm's annual debt-to-EBITDA. The red line shows the firm's normalized measure.

Cash Flow from Operations Projected Operating Cash Flow (in millions of USD) Source: Company Filings, Valuentum Projections

Last Fiscal Year CFO


5-year Projected CAGR

Kraft Heinz USD 5,394 28.0% -3.2%

Coca-Cola USD 12,625 19.9% 3.8%



Wal-Mart USD 24,181 -4.5% 14.1%



In the chart above, we show our baseline forecast for CFO as well as potential upside and downside cases.

Free Cash Flow (CFO-capital expenditures) Projected Free Cash Flow (in millions of USD) Source: Company Filings, Valuentum Projections

Last Fiscal Year FCF


5-year Projected CAGR Source: Company Filings, Valuentum Projections

Kraft Heinz USD 4,489 36.9% -4.7%

Coca-Cola USD 11,258 23.5% 3.5%



Wal-Mart USD 11,075 -14.0% 20.4%



In the chart above, we show our baseline forecast for free cash flow as well as potential upside and downside cases.

Kraft Heinz's cash flow from operations expansion has been greater than that of both itspeer group and industry group during the past three years. We expect the firm's pace ofcash flow from operations growth to fall below that of both its peer group and industrygroup during the next five years. Wal-Mart sports the highest expected cash flow fromoperations growth rate among peers.

Kraft Heinz's free cash flow expansion has been greater than that of both its peer groupand industry group during the past three years. We expect the firm's pace of free cashflow growth to fall below that of both its peer group and industry group during the nextfive years. Wal-Mart sports the highest expected free cash flow growth rate amongpeers.



Firms that generate a free cash flow margin (free cash flow divided by total revenue)above 5% are usually considered cash cows. Kraft Heinz's free cash flow margin hasaveraged about 15% during the past 3 years. As such, we think the firm's cash flowgeneration is relatively STRONG. The free cash flow measure shown above is derivedby taking cash flow from operations less capital expenditures and differs fromenterprise free cash flow (FCFF), which we use in deriving our fair value estimate forthe company. For more information on the differences between these two measures,please visit our website at Valuentum.com. At Kraft Heinz, cash flow from operationsincreased about 52% from levels registered two years ago, while capital expendituresexpanded about 18% over the same time period.

Firms that exhibit high leverage tend to be more risky than firms with relatively lowdebt loads, all else equal. We measure financial leverage by taking a firm's currenttotal debt load and dividing it by the firm's trailing average 3-year annual EBITDA.Firms that are over 3 for this metric, we rate as having high leverage. Companies thathave less than 1.5 turns of leverage (or a measure below 1.5), we rate as having lowleverage. Kraft Heinz's normalized debt-to-EBITDA measure of about 3.49 puts it inthe HIGH camp.


3,552

4,9295,394

768 596905

2,784

4,333 4,489

Dec-19 Dec-20 Dec-21

Cash from Operations Capital Expenditures Free Cash FlowKraft Heinz -normalized

leverage, 3.49

0

1

2

3

4

5

6

12/31/2019 12/31/2020 12/31/2021

Kraft Heinz- annual leverage Kraft Heinz - normalized leverageMedium Threshold HighThreshold

3,552

4,9295,394

5,037

4,5794,121

0

1,000

2,000

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2,784

4,333 4,489

3,878

3,5263,173

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Page 4



Neutral

Valuation Analysis

Valuation Assumptions Valuation BreakdownIn Millions of USD (except for per share items)

Revenue CAGR %Avg. EBIT Margin %Avg. Cash Tax Rate %Earnings Before Interest CAGR %Earnings Per Share CAGR %Free Cash Flow to the Firm CAGR %Earnings before interest = Net operating profits less adjusted taxes

Phase II --> III FCFF CAGR % 2.1% (II) 3% (III)Cost of Equity %After-tax Cost of Debt %Discount Rate (WACC) %Synthetic credit spread = 3%

Phase I Present ValuePhase II Present ValuePhase III Present ValueTotal Firm Value

Net Balance Sheet Impact

Total Equity ValueDiluted Shares OutstandingFair Value per Share

DCF Valuation Summary Enterprise Free Cash FlowFiscal Year End: 12/31/2019 12/31/2020 12/31/2021

4,553 7,960 7,472994 969 910768 596 905168 -824 991

- Acquisitions 199 0 744,412 9,157 6,412

In Millions of USD

Source: Company Filings, Valuentum Projections

Company NameValuentum Buying

Index™Forward Price-to-

Earnings

Price/Earnings-to-Growth (PEG), 5-

yearEV/Est. Normal

EBITDA

5-year Forward Earnings per Share CAGR

3-year Hist Avg ROIC, without

goodwillDividend Yield

%

Stock Price / Fair Value Estimate

Kraft Heinz 6 NMF 1.7 9.2 28.0% 12.6% 4.0% 105.4%

Coca-Cola 4 25.4 5.2 16.5 5.4% 44.2% 2.8% 137.3%

Philip Morris 3 16.5 3.6 10.9 4.7% 116.9% 5.0% 99.5%

Procter & Gamble 4 26.6 3.6 16.8 8.0% 44.5% 2.2% 131.1%

Wal-Mart 7 22.8 2.0 10.8 15.7% 25.7% 1.4% 113.5%

Peer Median 4.0 24.1 3.6 13.7 6.7% 44.3% 2.5% 122.3%

Industry Median 6.0 21.3 2.1 11.2 10.5% 24.2% 2.3% 105.3%

View back of report for a full list of industry constituents covered by Valuentum. VBI: Valuentum's ranking for the attractiveness of this investment at the date of the report.


18.7 12.3

20.7 15.2

16.8 12.8

23.1 18.0

14.5 12.2

22.7 19.0

Company Metrics versus Peer and Industry Medians

P/E on Est. Normal Diluted EPS Forward EV/EBITDA

14.5 9.5

In Millions of USD

---------- Actual ----------

We think Kraft Heinz is worth $38 per share with a fair value range of $29.00 -$48.00. The margin of safety around our fair value estimate is driven by the firm'sMEDIUM ValueRisk™ rating, which is derived from an evaluation of the historicalvolatility of key valuation drivers and a future assessment of them. Our near-termoperating forecasts, including revenue and earnings, do not differ much from consensusestimates or management guidance. Our model reflects a compound annual revenuegrowth rate of 1% during the next five years, a pace that is higher than the firm's 3-yearhistorical compound annual growth rate of -0.3%. Our model reflects a 5-year projectedaverage operating margin of 24.8%, which is above Kraft Heinz's trailing 3-yearaverage. Beyond year 5, we assume free cash flow will grow at an annual rate of 2.1%for the next 15 years and 3% in perpetuity. For Kraft Heinz, we use a 9.6% weightedaverage cost of capital to discount future free cash flows.

Earnings before Interest+ Depreciation - Capital Expenditures - Change in Working Capital

Enterprise Free Cash Flow (FCFF)

Our future forecasts for key valuation drivers result in a future free enterprise cashflow stream. Above, we show how we calculate enterprise free cash flow and thehistorical performance of the metric for Kraft Heinz. Over the next five years, weexpect the firm's enterprise free cash flow to expand at about a -4% compound annual growth rate. During years 6 through 20, we expect the measure to grow at a 2.1%rate. Beyond year 20 (in perpetuity), we grow the firm's free cash flow at inflation(3%).

-18,370

47,0961,236.0$38.00

28,69417,58365,466

9.6%Results19,189

-7.1%28.0%-4.4%

Long-term Projections

11.8%4.6%


5-year Projections In the chart below, we show the build up to our estimate of total enterprise value forKraft Heinz and the break down to the firm's total equity value, which we estimate tobe about 47.1USD billion. The present value of the enterprise free cash flowsgenerated during each phase of our model and the net balance sheet impact isdisplayed. We divide total equity value by diluted shares outstanding to arrive at our$38 per share fair value estimate.

1.0%24.8%21.0%


19,189

28,694

17,58318,370

47,096

0

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30,000

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Yr 1-5 Yr 6-20 Perpetuity Net Balance SheetImpact

Equity Value

Page 5



Neutral

Margin of Safety Analysis

Range of Potential Outcomes ValueRisk™ MEDIUM

Revenue Volatility 2.3%Gross Margin Volatility 5.1%Earnings (EBI) Volatility Greater than 50%Cash Flow (FCFF) Volatility Greater than 50%Fair Value Range 25.0%The Fair Value Range sets the premium or discount on our estimate of the firm's fair value.

Upside and Downside ProbabilitiesProbability (fair value < $0) Less than 0.1%Probability (fair value > 2x current share price) 0.00%

Future Path of Fair Value

The graph above shows the expected future fair value of the firm's shares relative to its current stock price.

Our discounted cash flow process values each firm on the basis of the present value ofall future free cash flows. Although we estimate the firm's fair value at about $38 pershare, every company has a range of probable fair values that's created by theuncertainty of key valuation drivers (like future revenue or earnings, for example). After all, if the future were known with certainty, we wouldn't see much volatility in themarkets as stocks would trade precisely at their known fair values. Our ValueRisk™rating sets the margin of safety or the fair value range we assign to each stock. In thegraph above, we show this probable range of fair values for Kraft Heinz. We think thefirm is attractive below $29 per share (the green line), but quite expensive above $48per share (the red line). The prices that fall along the yellow line, which includes ourfair value estimate, represent a reasonable valuation for the firm, in our opinion.

We strive to answer a few questions that investors often ask: 1) What are the chancesof a total loss of investment in this company? and 2) What is the chance that thecompany is really worth twice what I paid for it? The probability (fair value < 0)strives to answer the first question. It indicates the chance that the firm mayencounter insolvency based on the characteristics of its cash flow stream, capitalstructure, and risk profile. The probability (fair value > 2x current share price) strivesto answer the second question. It is our best estimate of whether investors areparticipating in a half-off sale by buying the company's shares at current prices.

We estimate Kraft Heinz's fair value at this point in time to be about $38 per share. Astime passes, however, companies generate cash flow and pay out cash to shareholdersin the form of dividends. The chart to the right compares the firm's current share pricewith the path of Kraft Heinz's expected equity value per share over the next three years,assuming our long-term projections prove accurate. The range between the resultingdownside fair value and upside fair value in Year 3 represents our best estimate of thevalue of the firm's shares three years hence. This range of potential outcomes is alsosubject to change over time, should our views on the firm's future cash flow potentialchange. The expected fair value of $48 per share in Year 3 represents our existing fairvalue per share of $38 increased at an annual rate of the firm's cost of equity less itsdividend yield. The upside and downside ranges are derived in the same way, but fromthe upper and lower bounds of our fair value estimate range.



Kraft Heinz receives a ValueRisk™ rating of MEDIUM based of the historicalvolatility of key drivers of economic value creation. The fair value range sets themargin of safety around our fair value estimate of the firm's shares.


$29

$38

$47

0 10 20 30 40 50 60 70 80

$60

$48Current Share Price, $40

$36

$0

$10

$20

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$70

Current Share Price Yr 1 Fair Value Yr 2 Fair Value Yr 3 Fair Value

Page 6



Neutral

Technical Analysis

Technical Evaluation BULLISH Money Flow Index (MFI) NEUTRAL

30-week Price and Volume Chart (weekly)Relative Price Strength STRONG

5-week Company Performance 6.6%5-week Market Benchmark Performance -8.2%5-week Relative Performance vs. Market Benchmark 14.9%13-week Company Performance 5.5%13-week Market Benchmark Performance -14.4%13-week Relative Performance vs. Market Benchmark 19.9%30-week Company Performance 10.1%30-week Market Benchmark Performance -11.7%30-week Relative Performance vs. Market Benchmark 21.8%

Upside/Downside Volume BULLISH Timeliness Matrix™ Equity Valuation

Relative Strength

Firms that are undervalued and currently showing near-term pricing strength score near the top right of the matrix.


Weak

Companies that are undervalued and showing near-term relative price strength couldrepresent timely buys, as the stock may be attractive to both value and momentuminvestors. A cross section of the firm's equity valuation and its relative share pricestrength is shown in the matrix above. We tend to prefer undervalued stocks that have strong pricing momentum, also called Valuentum stocks.

The level and trend of the Upside/Downside (U/D) volume ratio reveals whetherinstitutional participation has been bullish or bearish as of late. Kraft Heinz's U/Dvolume ratio of 1.7 is not only greater than 1 but also is better than its trailing average,indicating BULLISH institutional interest during the past several weeks.

Strong 1Neutral

The firm's near-term moving average (5-week, grey line) and medium-term movingaverage (13-week, red line) are shown in the chart above. Typically, when a shorter-term moving average crosses a medium- or longer-term moving average from below, itrepresents a bullish signal. If the short-term moving average crosses from above, tradersoften view this as bearish. Kraft Heinz's 5-week moving average resides above its 13-week measure, indicating a BULLISH trend. We'd grow wary of the firm's technicalsshould its 5-week moving average drop below its 13-week moving average.

The Money Flow Index (MFI) is an oscillator that uses price and volume to measurebuying and selling pressure. Chartists often look for overbought (above 80) andoversold (below 20) levels to warn of unsustainable near-term price extremes. KraftHeinz's MFI of 47 (green line) is neutral, suggesting the firm's stock is neitheroverbought nor oversold at this time. However, a score below 50 tends to favor bears.The MFI can also be used to gauge the strength or weakness of a firm's price trend. InKraft Heinz's case, its stock price and money flow neither reveals a bullish norbearish divergence, further supporting our neutral view on its money flow action.

A firm's relative price strength can be assessed over any number of time horizons. Weshow the firm's performance over the past 5 weeks, 13 weeks, and 30 weeks below.In arriving at our relative strength rating for each company, we assess the past 13weeks, which includes the market's reaction to the firm's most recently reportedquarter, where applicable, and other more recent economic events. During the past 13weeks, Kraft Heinz's shares returned 5.5%, while the market benchmark returned -14.4%. We think Kraft Heinz's 13-week relative price performance is STRONG.

In the chart above, we pinpoint the heaviest accumulation or distribution week of thefirm, determined by the week with the highest trading volume during the past 30 weeks.A heavy accumulation (buying) or distribution (selling) week often determines thefuture near-term direction of the firm's share price, as money managers continue tomove in or out of the stock in the days and weeks ahead driving the stock up or down,respectively. For Kraft Heinz, the week with the highest trading volume out of the last30 weeks was a week of heavy buying, or accumulation (green bar). Such marketactivity could indicate a reversal of a downtrend or further confirmation of the firm'suptrend.

Overvalued Fairly Valued Undervalued

Estimated Fair Value Fair Value Range Investment Style Sector Industry $38.00 $29.00 - $48.00 LARGE-CAP CORE Consumer Staples Recession Resistant

Kraft Heinz KHC FAIRLY VALUED

28

30

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36

38

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100,000,000

150,000,000

200,000,000

250,000,000

5-week Moving Average

13-week Moving Average

Stock Price

31

33

35

37

39

41

43

Overbought Line

Oversold Line

47 47

0102030405060708090

0.9

1.7

Average, 1.1

0.00.20.40.60.81.01.21.41.61.82.0

- 10-week Moving Average

Page 7



Neutral

Pro Forma Income Statement -------------------- Historical --------------------

In Millions of USD (except for per share items)Dec-19 Dec-21

Total Revenue 24,977 26,042

Cost of Goods Sold 16,830 17,360

Selling, General and Administrative Expenses 3,178 3,588

Other Operating Expenses 0 0

Operating Income 4,969 5,094

Unusual items 0 0

Operating Income, including unusual items 4,969 5,094

Interest Expense (1,361) (2,047)

Other Non-operating Income (947) (1,339)

Pre-tax Income 2,661 1,708

Income Taxes 728 684

Income after tax 1,933 1,024

Minority Interest and Equity Income 2 (12)

Net Income, excluding extra items 1,935 1,012

Income Available to Common, excluding extra items 1,935 1,012

Diluted Earnings per Share, excluding extra items 1.58 0.82

Diluted Weighted Shares Outstanding 1,224.0 1,236.0

Source: Company Filings, Xignite, Valuentum Projections

1,228.0 1,242.2 1,248.4


0.29 2.66 2.75

Note: Pro forma data in discounted cash-flow valuation may reflect significant adjustments from GAAP accounting data, including cash (not effective) tax rates and other analytical adjustments on a backward-looking and forward-looking basis. No individual data, by itself, found in this report should be used to make any investment decision.

356 3,300 3,430

356 3,300 3,430

(5) (12) (12)

361 3,312 3,442

669 880 915

1,030 4,192 4,356

(3,103) 0 0

(1,394) (2,047) (2,047)

0 0 0

5,527 6,239 6,403

5,527 6,239 6,403

0 0 0

17,008 15,526 15,473

3,650 3,209 3,198

26,185 24,974 25,074



---------- Projected ----------


Page 8



Neutral

Pro Forma Balance Sheet -------------------- Historical --------------------


AssetsTotal Cash (including marketable securities) 2,279 3,445Inventory 2,721 0Accounts Receivable 2,146 0Other Current Assets 951 5,549Total Current Assets 8,097 8,994

Gross Fixed Assets 10,242 10,674(Accumulated Depreciation) (3,187) (3,868)Net Property, Plant, and Equipment 7,055 6,806

Goodwill, Net 35,546 31,296Intangibles, Net 48,652 43,542Other Long-term Assets 2,100 2,756Total Assets 101,450 93,394

LiabilitiesAccounts Payable 4,387 0Other Current Liabilities 2,460 8,310Current Portion of Long-term Debt 1,028 754Total Current Liabilities 7,875 9,064

Long-term Debt 28,216 21,061Other Long-term Liabilities 13,736 13,971Total Liabilities 49,827 44,096

Preferred Stock 0 0

Shareholders' EquityCommon Stock and Additional Paid in Capital 56,840 53,391Retained Earnings (3,060) (1,682)Other Equity (2,157) (2,411)Total Shareholders' Equity 51,623 49,298

Total Liabilities and Shareholders' Equity 101,450 93,394




99,830 95,339 97,406

(2,311) (2,411) (2,411)50,103 50,870 52,562

55,108 53,638 53,887(2,694) (358) 1,086

0 0 0

49,727 44,470 44,843

28,070 21,061 21,06113,596 13,971 13,971

8,061 9,438 9,811

3,163 8,370 8,433236 754 754

4,662 313 624

99,830 95,339 97,406

46,667 43,542 43,5422,376 2,756 2,756

6,876 6,884 6,986

33,089 31,296 31,296

10,439 11,624 12,603(3,563) (4,741) (5,617)

2,788 5,549 5,54910,822 10,862 12,826

2,554 181 3602,063 157 315

3,417 4,975 6,601

---------- Projected ----------


Estimated Fair Value Fair Value Range Investment Style Sector Industry $38.00 $29.00 - $48.00 LARGE-CAP CORE Consumer Staples Recession Resistant

Kraft Heinz KHC FAIRLY VALUED

Page 9



Neutral

Pro Forma Cash Flow Statement -------------------- Historical --------------------


Cash from OperationsNet Income 1,933 1,024Depreciation and Amortization 994 910Deferred Income Taxes 0 0Operating Gains Or Losses 625 3,460Changes in Working Capital 0 0

Cash Flow from Operations 3,552 5,394

Cash from InvestingPurchase of Property, Plant, Equipment (768) (905)Other Investing Cash Flows 2,279 4,943Cash Flow from Investing 1,511 4,038

Cash from FinancingIssuance (Retirement) of Stock 0 0Issuance (Retirement) of Debt (1,828) 0Dividends Paid (1,953) (1,959)Other Financing Cash Flows (132) (7,415)Cash Flow from Financing (3,913) (9,374)

Foreign Exchange (6) (30)

Net Change in Cash 1,144 28




62 0 0

1,138 1,530 1,626

(3,331) (1,740) (1,749)

(1,958) (1,987) (1,997)(176) 0 0

0 247 249(1,197) 0 0

(522) (950) (979)

(596) (950) (979)74 0 0

4,929 4,220 4,354

3,599 0 00 36 36

969 873 8760 0 0

361 3,312 3,442



---------- Projected ----------


Page 10



Neutral

Recession ResistantRecession Resistant FAIRLY VALUED

Company Name TickerMarket Cap (USD-

mil) DCF Valuation ValueCreation™ ValueRisk™ ValueTrend™ Technicals Relative Strength

Altria Group MO 98,495 FAIRLY VALUED EXCELLENT LOW NEGATIVE BULLISH STRONG

Anheuser-Busch InBev BUD 119,408 UNDERVALUED EXCELLENT MEDIUM POSITIVE BEARISH NEUTRAL

Archer-Daniels-Midland ADM 52,434 FAIRLY VALUED EXCELLENT MEDIUM POSITIVE BULLISH STRONG

Campbell Soup CPB 13,643 FAIRLY VALUED EXCELLENT MEDIUM NEGATIVE VERY BULLISH STRONG

Casey's General CASY 7,661 FAIRLY VALUED GOOD MEDIUM POSITIVE BULLISH STRONG

Church & Dwight CHD 25,614 OVERVALUED EXCELLENT LOW NEGATIVE BULLISH STRONG

Clorox CLX 18,331 FAIRLY VALUED EXCELLENT LOW POSITIVE BEARISH WEAK

Coca-Cola KO 274,049 OVERVALUED EXCELLENT MEDIUM POSITIVE BULLISH STRONG

Colgate-Palmolive CL 67,427 FAIRLY VALUED EXCELLENT LOW POSITIVE VERY BULLISH STRONG

Costco COST 266,156 FAIRLY VALUED EXCELLENT LOW POSITIVE BULLISH STRONG

Fresh Del Monte FDP 1,235 UNDERVALUED POOR LOW NEGATIVE BEARISH STRONG

General Mills GIS 42,898 FAIRLY VALUED EXCELLENT LOW POSITIVE VERY BULLISH STRONG

Hormel Foods HRL 28,879 FAIRLY VALUED EXCELLENT LOW NEGATIVE BULLISH STRONG

Kellogg K 22,858 FAIRLY VALUED EXCELLENT LOW NEGATIVE BULLISH STRONG

Keurig Dr Pepper KDP 53,936 FAIRLY VALUED GOOD LOW NEGATIVE BEARISH STRONG

Kimberly-Clark KMB 42,696 FAIRLY VALUED EXCELLENT LOW NEGATIVE BEARISH STRONG

Kraft Heinz KHC 49,489 FAIRLY VALUED GOOD MEDIUM POSITIVE BULLISH STRONG

Kroger KR 44,667 OVERVALUED EXCELLENT MEDIUM POSITIVE BULLISH STRONG

Lancaster Colony LANC 4,253 FAIRLY VALUED EXCELLENT MEDIUM NEGATIVE BEARISH STRONG

McCormick MKC 27,805 FAIRLY VALUED EXCELLENT MEDIUM NEGATIVE BULLISH STRONG

Molson Coors TAP 10,961 FAIRLY VALUED GOOD LOW NEGATIVE VERY BEARISH STRONG

Mondelez Intl MDLZ 87,973 FAIRLY VALUED GOOD LOW POSITIVE BEARISH STRONG

PepsiCo PEP 239,471 FAIRLY VALUED EXCELLENT LOW POSITIVE BULLISH STRONG

Philip Morris PM 155,183 FAIRLY VALUED EXCELLENT LOW POSITIVE BEARISH STRONG

Procter & Gamble PG 412,554 OVERVALUED EXCELLENT LOW POSITIVE VERY BULLISH STRONG

Smucker SJM 15,425 FAIRLY VALUED EXCELLENT LOW POSITIVE VERY BULLISH STRONG

Sysco SYY 42,661 FAIRLY VALUED EXCELLENT MEDIUM POSITIVE BULLISH STRONG

Target TGT 109,554 FAIRLY VALUED EXCELLENT LOW NEGATIVE BULLISH STRONG

Tyson Foods TSN 33,204 FAIRLY VALUED EXCELLENT MEDIUM POSITIVE VERY BULLISH STRONG

Wal-Mart WMT 435,981 FAIRLY VALUED EXCELLENT LOW NEGATIVE BULLISH STRONG


LARGE-CAP CORE NEUTRAL

MEGA-CAP CORE ATTRACTIVE


LARGE-CAP GROWTH NEUTRAL


MEGA-CAP CORE NEUTRAL

LARGE-CAP VALUE NEUTRAL

MEGA-CAP CORE NEUTRAL

LARGE-CAP CORE UNATTRACTIVE

LARGE-CAP VALUE ATTRACTIVE



LARGE-CAP CORE ATTRACTIVE

MID-CAP VALUE NEUTRAL




SMALL-CAP VALUE ATTRACTIVE



MEGA-CAP CORE UNATTRACTIVE


MEGA-CAP CORE UNATTRACTIVE

MID-CAP GROWTH ATTRACTIVE

LARGE-CAP CORE UNATTRACTIVE





The above bar chart reveals the price/fair value of the company, its peers, and the industry as a whole.Shaded blue denotes that the firm has earned the highest rating for that respective category.Investment Style Relative Valuation



We think the Recession Resistant industry is fairly valued at this time. The industry'smarket cap is trading between 80% and 120% of our estimate of its fair value based onour DCF process. Although we use a firm-specific ValueRisk™ measure to determinewhether a firm is undervalued or overvalued based on our DCF process, we consider anindustry to be undervalued if it is trading below 80% of our estimate of its fair valueand overvalued if it is trading at over 120% of our estimate of its fair value. We thinkthese fair value ranges are appropriate given the diversification benefits of holding abasket of stocks. Although there may be individual opportunities within the RecessionResistant industry, we don't find the industry as a whole attractive based solely onvaluation.


105.4%

122.3%

105.3%

95%

100%

105%

110%

115%

120%

125%

Kraft Heinz Peer Median Recession Resistant

Page 11

Valuentum's Full Page Stock Report


BA

G

I

N

C

J

D

M

H

E

L

K

A DCF ValuationShows whether the firm is undervalued, fairly valued, or overvalued based on our DCF process and by how much.

B Valuentum Buying Index (VBI)Provides insight into the timeliness of an investment opportunity. We rank firms from 1 to 10 based on rigorous fiancial, valuation, and technical analysis. A 10 represents one of our top picks.

C Valuentum Value Rating (VVR) Indicates whether we think a firm is undervalued, fairly valued, or overvalued on the basis of our DCF process.

D Investment ConsiderationsEvaluates firms on 12 different measures, from the firm's growth and cash flow generation to the stock's money flow index and upside/downside volume. We reveal technical support and resistance levels.

E 30-week Price and Volume ActionDisplays the last accumulation or distribution week of the stock and historical price and volume action.

G Company VitalsShows sector,industry and other relevant company information.

H Business QualitySummary of the firm's ability to create value for shareholders compared wth the underlying risk of its operations.

I Normalized EPS and EBITDAEstimation of the firm's normalized earnings measures and the corresponding valuation mutliples.

J Investment HighlightsOur opinion of the company, including analysis of its financial and technical strengths and weaknesses.

K Relative ValuationComparison of the firm's PE, PEG, and Price/FV ratios versus peers.

L Returns Summary3-year averages of the firm's key return measures, including return on invested capital, with and without goodwill.

M Leverage, Coverage, and LiquidityA snapshot of the company's financial health.

N Financial SummaryA summary of the proforma financial statements found in the extended report.

VBI Score Action10 Top Pick9 We'd Consider Buying

6 to 8 Constructive (add/trim)3 to 6 Less Exciting (add/trim)1 to 2 We'd Consider Selling

Page 12

UNDERVALUED

FAIRLY VALUED

OVERVALUED

• Revenue Volatility • Margin Volatility • Earnings Volatility • Cash Flow VolatilityThe information and data contained in this report is not represented or warranted to be timely, complete, accurate, or correct. This report is for informational purposes only and should not be considered a solicitation to buy or sell a security. Before acting on any information in this report, you should consider whether the information is suitable for your particular circumstances and, if necessary, seek professional advice. Assumptions, opinions, and estimates are based on our judgment as of the date of the report and are subject to change without notice. Valuentum is not responsible for any errors or omissions or for results obtained from the use of this report. Redistribution is prohibited without written permission. To license Valuentum research, contact us at [email protected].

Historical firm-specific financial data generates our ValueCreation™, ValueRisk™, and ValueTrend™ ratings. The data provides the basis for our financial forecasts. Full annual forecasts of income statement, balance sheet, and cash flow statement items. Firm-specific cost of equity, cost of debt, weighted average cost of capital, and long-term growth and profitability measures estimated.

A complete three-stage free cash flow to the firm valuation model generates an estimate of the firm's equity value per share based on estimated future free cash flows.The volatility of key valuation drivers are estimated and a margin of safety is determined.

The firm's stock price is compared to the suggested margin of safety. If a firm's stock price falls below the lower bound of our estimated fair value range, it receives Valuentum's highest Value Rating.

About Valuentum

@Valuentum, we strive to stand out from the crowd. Mostinvestment research publishers fall into a few camps,whether it be value, growth, income, momentum, chartistor some variant of the aforementioned. We think each inits own right holds merit, but we think the combination ofthese approaches can be even more powerful. After all,stock price movements aren’t just driven by investors ofthe value or growth variety, but by all market participants.Therefore, we look at stocks from a variety of investmentperspectives in order to better understand and identifyideas. We want to provide relevant information.

The core of our process is grounded in rigorous discountedcash flow analysis and incorporates the concept of amargin of safety. We offer a fair value estimate for eachcompany and provide a relative valuation assessment inthe context of a company’s industry and closest peers. Across section of our ValueCreation™ and ValueRisk™ratings provides a financial assessment of a company’sbusiness quality, while our ValueTrend™ rating offersinsight into the trajectory of a firm’s economic profitcreation. The Economic Castle rating measures themagnitude of future economic value generation, and theDividend Cushion ratio assesses the financial capacity of acompany to keep raising its dividend.

Our analysis doesn’t stop there. We also offer a technicalevaluation of the stock as well as other momentumindicators. We not only want to reveal to readers whichfirms may be undervalued, in our view, but we also wantto provide readers with information to help them assessentry and exit points. Most research publishers focus onarriving at a target price or fair value estimate, but mayfall short of providing a technical assessment to bolsterbuy and sell disciplines. We strive to go the distance andprovide readers with answers--not half the story.

An explanation of our approach would not be complete ifwe didn’t describe our ideal stock idea. We’re lookingfor companies that are undervalued--both on a DCF basisand versus peers--have strong growth potential, have asolid track record of creating economic profits forshareholders with reasonable risk, are strong cash flowgenerators, have manageable financial leverage, and arecurrently showing bullish technical and momentumindicators. For dividend growth ideas, we look forcompanies that have both the capacity and willingness tokeep raising the dividend.

Can such stock ideas exist? Subscribe to Valuentum toreceive our best investment ideas and analysis onhundreds of stocks, dividends, ETFs and more.

Financial Forecasts

Financial Statement Analysis

Discounted Cash Flow Valuation

ModelValueRisk™

Rating

Valuentum Value Rating (VVR)

Page 13

VBI Score Action10 Top Pick9 We'd Consider Buying

6 to 8 Constructive (add/trim)3 to 6 Less Exciting (add/trim)1 to 2 We'd Consider Selling

Methodology for Picking Stocks - Valuentum Buying Index™ (VBI)

@ Valuentum, we like to look at companies from anumber of different perspectives. The Valuentum BuyingIndex (VBI) combines rigorous financial and valuationanalysis with an evaluation of a stock's technicals to derivea rating between 1 and 10 for each company. The VBIplaces considerable emphasis on a company's discountedcash-flow (DCF) valuation, its relative valuation versuspeers (both forward PE and PEG ratios), and its technicalsin order to help readers assess entry and exit points on themost interesting ideas.

Let's follow the red line on the flow chart below to seehow a company can score a 10, the best mark on the index(a "Top Pick"). First, the company would need to be'undervalued' on a DCF basis and 'attractive' on a relativevalue basis. The stock would also have to be exhibiting

'bullish' technicals. The firm would need aValueCreation™ rating of 'good' or 'excellent', exhibit'high' or 'aggressive' growth prospects, and generate atleast a 'medium' or 'neutral' assessment for cash flowgeneration, financial leverage, and relative price strength.

This is a tall order for any company. Stocks that don'tmake the cut for a 10 are ranked accordingly, with theleast attractive stocks, in our opinion, garnering a ratingof 1 ("We'd sell"). Most of our coverage universeregisters ratings between 3 and 7, but at any given timethere could be large number of companies garneringeither very high or very low scores, especially at marketlows or tops, respectively.

The Best Ideas Newsletter portfolio puts the VBI intopractice.

The information contained in this report is not represented or warranted to be accurate, correct, complete, or timely. This report is for informational purposes only and should not be considered a solicitation to buy or sell a security. Before acting on any information in this material, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Assumptions, opinions, and estimates are based on our judgment as of the date of the report and are subject to change without notice. Valuentum is not responsible for any errors or omissions or for results obtained from the use of this report. Redistribution is prohibited without written permission. To license Valuentum research, contact us at [email protected].

DCF FairlyValued

DCF Undervalued

Relative ValueUnattractive/Neutral

Relative Value Attractive

Relative ValueUnattractive/Neutral


Technicals Bearish: 1

Technicals Neutral: 2

TechnicalsBullish: 4

Technicals Bullish: 7

TechnicalsBearish: 6

Technicals >= BullishValueCreation(TM) >= GoodGrowth >= HighCash Flow Generation >= MediumFinancial Leverage <= MediumRelative Strength >= Neutral

Final Score: 10



TechnicalsBearish: 3

Relative Value Unattractive/Neutral











Initial Index Score

DCF Overvalued

Page 14

The information contained in this report is not represented or warranted to be accurate, correct, complete, or timely. This report is for informational purposes only and should not be considered a solicitation to buy or sell a security. Before acting on any information in this material, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Assumptions, opinions, and estimates are based on our judgment as of the date of the report and are subject to change without notice. Valuentum is not responsible for any errors or omissions or for results obtained from the use of this report. Redistribution is prohibited without written permission. To license Valuentum research, contact us at [email protected].

ValueRisk™. This is a proprietary Valuentum measure. ValueRisk™ indicates thehistorical volatility of key valuation drivers, including revenue, gross margin, earningsbefore interest, and enterprise free cash flow. The standard deviation of each measure iscalculated and scaled against last year's measure to arrive at a percentage deviation foreach item. These percentage deviations are weighted equally to arrive at thecorresponding fair value range for each stock, measured in percentage terms. The firm'sperformance is measured along the scale of LOW, MEDIUM, HIGH, and VERY HIGH.The ValueRisk™ rating for each firm also determines the fundamental beta of eachfirm along the following scale: LOW (0.85), MEDIUM (1), HIGH (1.15), VERY HIGH(1.3).

Range of Potential Outcomes. The firm's margin of safety is shown in the graphicof a normal distribution. We consider a firm to be undervalued if its stock price fallsalong the green line and overvalued if the stock price falls along the red line. Weconsider the firm to be fairly valued if its stock price falls along the yellow line.

Return on Invested Capital. At Valuentum, we place considerable emphasis onreturn on invested capital (both with and without goodwill). The measure focuses onthe return (earnings) the company is generating on its operating assets and is superiorto return on equity and return on assets, which can be skewed by a firm's leverage orexcess cash balance, respectively. ValueTrend™. This is a proprietary Valuentum measure. ValueTrend™ indicates the

trajectory of the firm's return on invested capital (ROIC). Firms that earned an ROIClast year that was greater than the 3-year average of the measure earn a POSITIVErating. Firms that earned an ROIC last year that was less than the 3-year average of themeasure earn a NEGATIVE rating.

Technical Evaluation. We evaluate a firm's near-term and medium-term movingaverages and money flow index (MFI) to assign each firm a rating along thefollowing scale: VERY BULLISH, BULLISH, NEUTRAL, BEARISH, and VERYBEARISH.

Cash Flow Generation. Firms' cash flow generation capacity are measured along thescale of STRONG, MEDIUM, and WEAK. A firm with a 3-year historical free cashflow margin (free cash flow divided by sales) greater than 5% receives a STRONGrating, while firms earning less than 1% of sales as free cash flow receive a WEAKrating.

Stock Price Relative Strength. We assess the perfomance of the company's stockduring the past quarter, 13 weeks, relative to an ETF that mirrors the aggregateperformance of constituents of the stock market. Firms are measured along the scaleof STRONG, NEUTRAL, and WEAK. Companies that have outperformed themarket index by more than 2.5% during this 13-week period receive a STRONGrating, while firms that trailed the market index by more than 2.5% during this 13-week period receive a WEAK rating.

Financial Leverage. Based on the firm's normalized debt-to-EBITDA metric, we rank firms on the following scale: LOW, MEDIUM, and HIGH. Companies with a normalized debt-to-EBITDA ratio below 1.5 receive a LOW score, while those with a measure above 3 receive a HIGH score.

Money Flow Index (MFI). The MFI is a technical indicator that measures buyingand selling pressure based on both price and volume. Traders typically use thismeasure to identify potential reversals with overbought and oversold levels. We use a14-week measure to rank firms along the following scale: EXTREMELYOVERBOUGHT (>90), OVERBOUGHT (80-90), NEUTRAL (20-80), OVERSOLD(10-20), EXTREMELY OVERSOLD (0-10).

Upside/Downside Volume. Heavy volume on up days and lower volume on down days suggests that institutions are heavily participating in a stock's upward advance. We use the trailing 14-week average of upside and downside volume to calculate an informative ratio. We rank each firm's U/D volume ratio along the following scale: BULLISH, IMPROVING, DETERIORATING, and BEARISH.

GlossaryEstimated Fair Value. This measure is our opinion of the fair equity value per share ofthe company. If our forecasts prove accurate, which may not always be the case, wemay expect a firm's stock price to converge to this value within the next 3 years.

Investment Style. Valuentum uses its own proprietary stock-classification system.Nano-cap: Less than $50 million; Micro-cap: Between $50 million and $200 million;Small-cap: Between $200 million and $2 billion; Mid-cap: Between $2 billion and$10 billion; Large-cap: Between $10 billion and $200 billion; Mega-cap: Over $200billion. Blend: Firm's that we think are undervalued and exhibit high growthprospects (growth in excess of three times the rate of assumed inflation). Value:Firm's that we believe are undervalued, but do not exhibit high growth prospects.Growth: Firms that are not undervalued, in our opinion, but exhibit high growthprospects. Core: Firms that are neither undervalued nor exhibit high growthprospects.

Fair Value Range. The fair value range represents an upper bound and lower bound,between which we would consider the firm to be fairly valued. The range considers ourestimate of the firm's fair value and the margin of safety suggested by the volatility ofkey valuation drivers, including revenue, gross margin, earnings before interest, andenterprise free cash flow (the determinants behind our ValueRisk™ rating).

DCF Valuation. We opine on the firm's valuation based on our DCF process. Firmsthat are trading with an appropriate discount to our fair value estimate receive anUNDERVALUED rating. Firms that are trading within our fair value range receive aFAIRLY VALUED rating, while firms that are trading above the upper bound of ourfair value range receive an OVERVALUED rating.

Company Vitals. In this section, we list key financial information and the sector andindustry that Valuentum assigns to the stock. The P/E-Growth (5-yr), or PEG ratio,divides the current share price by last year's earnings (EPS) and then divides thatquotient by our estimate of the firm's 5-year EPS growth rate. The estimatednormalized diluted EPS and estimated normalized EBITDA represent the five-yearforward average of these measures used in our discounted cash flow model. The P/Eon estimated normalized EPS divides the current share price by estimated normalizeddiluted EPS. The EV/estimated normalized EBITDA considers the current enterprisevalue of the company and divides it by estimated normalized EBITDA. EV is definedas the firm's market capitalization plus total debt, minority interest, preferred stockless cash and cash equivalents.

Relative Value. We compare the firm's forward price-to earnings (PE) ratio and itsprice/earnings-to-growth (PEG) ratio to that of its peers. If both measures fall below thepeer median, the firm receives an ATTRACTIVE rating. If both are above the peermedian, the firm receives an UNATTRACTIVE rating. Any other combination resultsin a NEUTRAL rating.

ValueCreation™. This is a proprietary Valuentum measure. ValueCreation™indicates the firm's historical track record in creating economic value for shareholders,taking the average difference between ROIC (without goodwill) and the firm'sestimated WACC during the past three years. The firm's performance is measured alongthe scale of EXCELLENT, GOOD, POOR, and VERY POOR. Those firms withEXCELLENT ratings have a demonstrated track record of creating economic value,while those that register a VERY POOR mark have been destroying economic value.

Business Quality Matrix. We compare the firm's ValueCreation™ and ValueRisk™ratings. The box is an easy way for investors to quickly assess the business quality ofa company. Firms that generate economic profits with little operating variabilityscore near the top right of the matrix.

Timeliness Matrix. We compare the company's recent stock performance relative tothe market benchmark with our assessment of its valuation. Firms that areexperiencing near-term stock price outperformance and are undervalued by ourestimate may represent timely buys.

Page 15

KHC Rating History Price Fair Value VBI7-Apr-22 $40.04 $38.00 618-Jun-21 $40.50 $36.00 315-Oct-20 $32.16 $31.00 330-Oct-19 $28.50 $34.00 64-Mar-19 $33.04 $38.00 322-Feb-19 $34.95 $38.00 38-Oct-18 $54.24 $57.00 31-Jun-18 $57.65 $60.00 59-Feb-18 $71.38 $66.00 329-Sep-17 $77.55 $68.00 318-Aug-17 $84.49 $68.00 323-Jun-17 $88.85 $65.00 110-Feb-17 $90.20 $65.00 45-Sep-16 $85.97 $60.00 1

Disclosures, Disclaimers & Additional SourcesTo send us feedback or if you have any questions, please contact us at [email protected]. We're always looking for ways to better serve your investment needs and improve our research.

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Kraft Heinz KHC FAIRLY VALUED Buying Index™ 3 Value Rating