Kraft Heinz’s shares plunge on weak results

Kraft Heinz Co. suffered its worst stock decline in more than two years after posting disappointing sales and profit, boosting speculation that the food giant will need a large acquisition to fuel growth.

The shares tumbled as much as 7 percent in the wake of the results, which reflected a persistent slump in the U.S. packaged-food industry. Though Kraft has a stable of household names — including Capri Sun, Lunchables, Oscar Mayer and Velveeta — consumers have shifted to upstart brands and fresh foods. Nuts and cold cuts were particularly weak in the U.S. during the fourth quarter, Kraft Heinz said.

One year after Kraft Heinz was rebuffed in a bid to buy Unilever, the company is now under more intense pressure to find another deal. Chief Executive Officer Bernardo Hees signaled Friday that a transaction is possible. He declined to name specific targets, and reiterated that the company feels confident about its prospects to increase sales of current brands.

But investors are skeptical. Kraft Heinz has seen about $30 billion in market value wiped out since the Unilever bid was rejected.

“This reinforces that growth is extremely challenged for this company,” said Ken Shea, an analyst at Bloomberg Intelligence

Earnings amounted to 90 cents a share in the fourth quarter. That was 5 cents below analysts’ estimates. Though sales grew for the second straight period, they still missed projections. Revenue came in at $6.88 billion last quarter, while analysts had estimated $6.91 billion on average.