As food companies go, Kraft Foods (NYSE:KFT) has done alright over the past couple of years. Despite the controversy over the company's aggressive move to bring Cadbury into the fold, Kraft has basically matched the market, done better than rival Kellogg (NYSE:K), and kept pace with the likes of ConAgra (NYSE:CAG) and Unilever (NYSE:UL). The question now is whether a dramatic restructuring of the business is going to significantly improve growth and shareholder value, or whether it's simply a distraction to buy time for a management team that doesn't appear to earn its cost of capital.
Q2 Not as Strong as It Seems
Wall Street seemed oddly pleased with Kraft's second quarter earnings. True, the company did beat the average estimate by a healthy margin and surpassed even the high end of the range. What's more, reported growth of over 13% and organic growth of over 7% is quite good for a huge food company (Kraft is second-largest in the world behind Nestle (Nasdaq:NSRGY). Still, volume growth was less than 2% and the better-than 5% boost to price and mix was helped by a calendar artifact.
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