With a family of eight brands worth $1 billion-plus each, Kraft Heinz (KHC 1.80%) has a solid footing in the consumer staples sector. But the stock has fallen nearly 63% from its 2017 highs. What caused the plunge? And can the shares make a comeback?

On the hopeful side, Kraft Heinz just affirmed its financial guidance, lowered its leverage target, and provided details on its long-term growth strategy -- including an emphasis on its food service (that's food served outside of the home in such places as hotels and restaurants).

Let's take a closer look at the company and where it could be headed.

Focusing on food service

Kraft Heinz is the third-largest food and beverage company in North America and the fifth-largest in the world. Besides Kraft and Heinz, this well-known consumer staples purveyor also operates such brands as Oscar Mayer, Philadelphia, Velveeta, and others.

Kraft Heinz recently outlined its long-term growth strategy, targeting 2% to 3% organic net sales growth and 6% to 8% adjusted earnings-per-share growth. The company also announced three strategic areas of focus: North American retail sales, emerging markets retail sales, and food service. Food service currently comprises 13% to 15% of the company's sales, and Kraft is seeking to bolster that segment.

At the Barclays Consumer Staples Conference in Boston last week, Kraft CEO Miguel Patricio explained that food service is not only a viable channel for sales, but -- more importantly -- is a brand-awareness strategy. According to Patricio, when executed properly, food service can help educate new consumers about its products.

The food service channel has also historically grown 1.5 times faster than the rest of the industry. Kraft Heinz has implemented its food-service strategy by concentrating on known high-potential opportunities, including quick-service restaurants (QSR) and schools.

It's been a tough few years for shareholders

The current share price of Kraft Heinz is roughly 62% below the highs of 2017. What caused the stock's poor performance? As a well-established consumer staples company, shouldn't Kraft Heinz have fared better during the pandemic and ensuing inflationary fallout?

It all started when Kraft merged with Heinz in 2015. Management cut more than $1.7 billion in spending, which sent profit margins soaring -- delighting investors. In February 2017, the stock reached an all-time high of $97.77.

In the meantime, because of the company's disproportionate emphasis on cost-cutting over research and development, Kraft Heinz fell out of step with consumer trends. Instead of focusing on creating food products to complement ever-changing tastes, Heinz was too busy keeping operational costs down.

As a result, the company saw sales and profits dwindle in subsequent quarters. Between 2018 and 2019, Kraft Heinz's shareholder dividends dropped 36%, sending investor sentiment further into a nosedive.

Is it finally time to buy the dip?

The rough patch for Kraft Heinz might finally be over, thanks to some recent adjustments. Earlier this month, the company announced a reduction in its leverage target -- to approximately three times equity versus the previous target ratio of four. While still not ideal, the lower target shows Kraft's determination to pay down its debt. This "meaningfully" reduced leverage should strengthen Kraft's balance sheet and provide additional financial flexibility.

Kraft Heinz also reaffirmed its prior guidance, projecting high-single-digit 2022 organic net sales growth and adjusted EBITDA to be in the $5.8 billion to $6.0 billion range. This guidance has taken inflation into account at an annual rate of 20%, which is up from the company's previous estimate in the high teens.

Kraft has also streamlined its portfolio of brands and sold off select assets, focusing on what is working and cutting out what isn't. A recent example occurred last month, when Kraft Heinz agreed to sell its B2B powdered cheese manufacturing facility in Albany, Minnesota.

As a consumer staples giant, Kraft Heinz has all the makings of a recession-proof long-term investment. However, the company's future growth will require a balancing act of adapting its product offerings while keeping costs down. If Kraft Heinz's long-term strategy succeeds, watch for a recovery of this consumer staples stock.