Bullishness toward Kraft Heinz on Friday stems primarily from the company's second-quarter earnings release, which featured better-than-expected revenue and earnings per share. But another contributor toward the stock's jump on Friday could be a report from The New York Post stating Kraft Heinz could be considering an acquisition of Campbell Soup (NYSE:CPB).
Campbell Soup jumped on the news that it may be an acquisition target. Shares increased as much as 5.4%, but are up 2.7% at 3:45 p.m. EDT.
Kraft Heinz reported second-quarter revenue of $6.69 billion -- up 0.7% from the year-ago quarter. Adjusted EPS rose from $0.98 in the year-ago quarter to $1.
On average, analysts were expecting revenue of $6.59 billion and adjusted EPS of $0.92.
Regarding speculation that Heinz is considering making an offer for Campbell, The New York Post's unnamed source said Kraft Heinz isn't likely to pay a meaningful premium for Campbell. The Post said neither company commented on the rumor.
Based on the momentum Kraft Heinz is building, this is certainly a better time than usual for the company to make an acquisition. Kraft Heinz CEO Bernardo Hees said the company has been "encouraged by our recent performance in the marketplace."
According to Heed, management expects to sustain its top-line growth over the long haul, thanks to "a strong pipeline of new product, marketing and whitespace initiatives that are backed by investments in capabilities for brand and category advantage." Further, the company expects profitability to improve by the end of the year, "with further momentum into 2019."