Kraft Heinz (KHC) Jumps on the ‘Buy Canadian’ Trend with $250 Million Investment

U.S. packaged food giant Kraft Heinz KHC -0.51% ▼ is investing $250 million to upgrade its Montreal production facility and ensure that the products it sells north of the American border are “made in Canada.”

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The maker of Heinz ketchup and Philadelphia Cream Cheese said that the investment will upgrade and modernize its Montreal production plant, which employs more than half of the company’s 2,000 employees in Canada.

The facility, which houses the company’s main operations in Canada, currently produces brands such as Kraft Dinner, Philadelphia Cream Cheese, and Kraft Peanut Butter. The move to improve and increase production within Canada comes amid a consumer backlash against American-made products. Increasingly, consumers are looking for “made in Canada” labels when making purchasing decisions.

Responding to Market Demands

“Canadians love products made in Canada. The more we can make in Canada from our Canadian factory, that’s always a more efficient way to do it, and Canadian consumers love that,” said Simon Laroche, President of Kraft Heinz Canada, in a media interview.

Kraft Heinz said that 90% of the Heinz ketchup sold in Canada is made in the country already, but that figure will get closer to 100% once the Montreal facility is upgraded, with more products and vegetables such as tomatoes sourced from within Canada.

Is KHC Stock a Buy?

Kraft Heinz stock has a consensus Moderate Sell rating among 13 Wall Street analysts. That rating is based on nine Hold and four Sell recommendations issued in the last three months. The average KHC price target of $23.38 implies 7.79% upside from current levels.

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