TLDR
- Kraft Heinz shares dropped 3.6% premarket after a filing revealed Berkshire Hathaway could sell its 325 million share position worth $7.7 billion
- Buffett’s company has written down the investment twice since 2019, recording total losses of $6.76 billion on the food maker
- The filing comes ahead of Kraft Heinz’s planned breakup into two separate companies scheduled for the second half of 2026
- The food company has struggled with a 3% sales decline in 2024 as consumer preferences shifted toward healthier alternatives
- Wall Street maintains a Hold rating on the stock with 13 Hold ratings, zero Buys, and one Sell recommendation
Kraft Heinz stock slid 3.6% in premarket trading Wednesday following a regulatory disclosure that Berkshire Hathaway may dump its entire stake. The filing permits Warren Buffett’s conglomerate to sell 325,442,152 shares representing 27.5% ownership.
Based on Tuesday’s closing price of $23.76 per share, the stake carries a value of approximately $7.7 billion. While the document doesn’t guarantee a transaction, it provides Berkshire the flexibility to exit at any time.
Berkshire established the position in 2015 when Kraft Foods merged with H.J. Heinz. Buffett joined forces with 3G Capital, a Brazilian private equity firm, to create the combined food giant.
The partnership hasn’t delivered expected returns. Buffett acknowledged the investment as a mistake years ago, admitting he overestimated the company’s potential in a changing market.
Write-Downs Tell the Story
Berkshire’s losses paint a stark picture. The company recorded a $3 billion write-down in 2019 as Kraft Heinz’s brand values declined. Another $3.76 billion charge followed in August 2025 as conditions worsened.
Combined, these write-downs total $6.76 billion in losses. The potential sale would end one of Berkshire’s most problematic investments from the past decade.
Kraft Heinz faces mounting challenges across its business. Consumers increasingly favor fresh foods over packaged options. Health-conscious shoppers, particularly younger demographics, have moved away from traditional processed foods.
The company drew criticism for inadequate brand investment and lack of product innovation. Competitors offering healthier alternatives captured market share while Kraft Heinz’s legacy brands stagnated.
Revenue declined 3% in 2024 as these pressures intensified. Food inflation complicated matters further, pushing budget-conscious consumers toward private label alternatives.
Breakup on the Horizon
Management announced a split plan in September 2025 to address structural issues. The company will separate into two entities, dividing grocery products from sauces and spreads.
Executives cited the current corporate structure as a barrier to effective capital deployment. They argued that two focused companies could better prioritize investments and scale growth opportunities.
Steve Cahillane stepped into the CEO role on January 1, 2026. His primary mission involves executing the separation, scheduled for completion in late 2026.
The timing coincides with leadership changes at Berkshire, where Greg Abel replaced Buffett on the same date. Both Abel and Buffett have publicly opposed the split strategy.
Their opposition potentially influenced Berkshire’s decision to prepare an exit. The filing suggests the investment firm doesn’t want involvement in the post-split companies.
Analyst coverage reflects skepticism about Kraft Heinz’s turnaround prospects. The stock has fallen 19.4% over the trailing twelve months as fundamental challenges persisted.
TipRanks data shows no analysts recommend buying shares. Thirteen rate it Hold while one suggests selling. The average target price of $25.38 indicates possible upside of 6.8% from current trading levels. At Tuesday’s close of $23.76, Berkshire’s 27.5% stake is valued at $7.7 billion.
