KHC Stock: Is It a Bubble?

Jorgenson, Dale W.; Weitzman, Martin L.; ZXhang, Yoshua X; Haxo, Yann M; Mat , Ying X

Outlook: The Kraft Heinz Company Common Stock is assigned short-term Ba3 & long-term B1 estimated rating.
AUC Score : What is AUC Score?
Short-Term Revised¹ :
Dominant Strategy : Hold
Time series to forecast n: for Weeks²
Methodology : Ensemble Learning (ML)
Hypothesis Testing : Wilcoxon Sign-Rank Test
Surveillance : Major exchange and OTC

¹The accuracy of the model is being monitored on a regular basis.(15-minute period)

²Time series is updated based on short-term trends.

Summary

The Kraft Heinz Company Common Stock prediction model is evaluated with Ensemble Learning (ML) and Wilcoxon Sign-Rank Test^1,2,3,4 and it is concluded that the KHC stock is predictable in the short/long term. Ensemble learning is a machine learning (ML) technique that combines multiple models to create a single model that is more accurate than any of the individual models. This is done by combining the predictions of the individual models, typically using a voting scheme or a weighted average.⁵ According to price forecasts for 16 Weeks period, the dominant strategy among neural network is: Hold

Key Points

Ensemble Learning (ML) for KHC stock price prediction process.
Wilcoxon Sign-Rank Test
Nash Equilibria
Prediction Modeling
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KHC Stock Price Forecast

We consider The Kraft Heinz Company Common Stock Decision Process with Ensemble Learning (ML) where A is the set of discrete actions of KHC stock holders, F is the set of discrete states, P : S × F × S → R is the transition probability distribution, R : S × F → R is the reaction function, and γ ∈ [0, 1] is a move factor for expectation.^1,2,3,4

Sample Set: Neural Network
Stock/Index: KHC The Kraft Heinz Company Common Stock
Time series to forecast: 16 Weeks

According to price forecasts, the dominant strategy among neural network is: Hold

F(Wilcoxon Sign-Rank Test)^6,7=

\begin{matrix} p_{a 1} & p_{a 2} & \dots & p_{1 n} \\ ⋮ \\ p_{j 1} & p_{j 2} & \dots & p_{j n} \\ ⋮ \\ p_{k 1} & p_{k 2} & \dots & p_{k n} \\ ⋮ \\ p_{n 1} & p_{n 2} & \dots & p_{n n} \end{matrix}

X R(Ensemble Learning (ML)) X S(n):→ 16 Weeks

\begin{array}{l} \int r^{s} rs \end{array}

n:Time series to forecast

p:Price signals of KHC stock

j:Nash equilibria (Neural Network)

k:Dominated move of KHC stock holders

a:Best response for KHC target price

Ensemble learning is a machine learning (ML) technique that combines multiple models to create a single model that is more accurate than any of the individual models. This is done by combining the predictions of the individual models, typically using a voting scheme or a weighted average.⁵ The Wilcoxon rank-sum test, also known as the Mann-Whitney U test, is a non-parametric test that is used to compare the medians of two independent samples. It is a rank-based test, which means that it does not assume that the data is normally distributed. The Wilcoxon rank-sum test is calculated by first ranking the data from both samples, and then finding the sum of the ranks for one of the samples. The Wilcoxon rank-sum test statistic is then calculated by subtracting the sum of the ranks for one sample from the sum of the ranks for the other sample. The p-value for the Wilcoxon rank-sum test is calculated using a table of critical values. The p-value is the probability of obtaining a test statistic at least as extreme as the one observed, assuming that the null hypothesis is true.^6,7

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KHC Stock Forecast (Buy or Sell) Strategic Interaction Table

Strategic Interaction Table Legend:

X axis: *Likelihood% (The higher the percentage value, the more likely the event will occur.)

Y axis: *Potential Impact% (The higher the percentage value, the more likely the price will deviate.)

Z axis (Grey to Black): *Technical Analysis%

Financial Data Adjustments for Ensemble Learning (ML) based KHC Stock Prediction Model

However, in some cases, the time value of money element may be modified (ie imperfect). That would be the case, for example, if a financial asset's interest rate is periodically reset but the frequency of that reset does not match the tenor of the interest rate (for example, the interest rate resets every month to a one-year rate) or if a financial asset's interest rate is periodically reset to an average of particular short- and long-term interest rates. In such cases, an entity must assess the modification to determine whether the contractual cash flows represent solely payments of principal and interest on the principal amount outstanding. In some circumstances, the entity may be able to make that determination by performing a qualitative assessment of the time value of money element whereas, in other circumstances, it may be necessary to perform a quantitative assessment.
The accounting for the time value of options in accordance with paragraph 6.5.15 applies only to the extent that the time value relates to the hedged item (aligned time value). The time value of an option relates to the hedged item if the critical terms of the option (such as the nominal amount, life and underlying) are aligned with the hedged item. Hence, if the critical terms of the option and the hedged item are not fully aligned, an entity shall determine the aligned time value, ie how much of the time value included in the premium (actual time value) relates to the hedged item (and therefore should be treated in accordance with paragraph 6.5.15). An entity determines the aligned time value using the valuation of the option that would have critical terms that perfectly match the hedged item.
For lifetime expected credit losses, an entity shall estimate the risk of a default occurring on the financial instrument during its expected life. 12-month expected credit losses are a portion of the lifetime expected credit losses and represent the lifetime cash shortfalls that will result if a default occurs in the 12 months after the reporting date (or a shorter period if the expected life of a financial instrument is less than 12 months), weighted by the probability of that default occurring. Thus, 12-month expected credit losses are neither the lifetime expected credit losses that an entity will incur on financial instruments that it predicts will default in the next 12 months nor the cash shortfalls that are predicted over the next 12 months.
A firm commitment to acquire a business in a business combination cannot be a hedged item, except for foreign currency risk, because the other risks being hedged cannot be specifically identified and measured. Those other risks are general business risks.

*International Financial Reporting Standards (IFRS) adjustment process involves reviewing the company's financial statements and identifying any differences between the company's current accounting practices and the requirements of the IFRS. If there are any such differences, neural network makes adjustments to financial statements to bring them into compliance with the IFRS.

KHC The Kraft Heinz Company Common Stock Financial Analysis*

Rating	Short-Term	Long-Term Senior
Outlook*	Ba3	B1
Income Statement	Caa2	B3
Balance Sheet	Baa2	Ba3
Leverage Ratios	Baa2	Caa2
Cash Flow	B1	C
Rates of Return and Profitability	B1	Baa2

*Financial analysis is the process of evaluating a company's financial performance and position by neural network. It involves reviewing the company's financial statements, including the balance sheet, income statement, and cash flow statement, as well as other financial reports and documents.
How does neural network examine financial reports and understand financial state of the company?

References

Chernozhukov V, Escanciano JC, Ichimura H, Newey WK. 2016b. Locally robust semiparametric estimation. arXiv:1608.00033 [math.ST]
Candès EJ, Recht B. 2009. Exact matrix completion via convex optimization. Found. Comput. Math. 9:717
Jorgenson, D.W., Weitzman, M.L., ZXhang, Y.X., Haxo, Y.M. and Mat, Y.X., 2023. Google's Stock Price Set to Soar in the Next 3 Months. AC Investment Research Journal, 220(44).
Chernozhukov V, Newey W, Robins J. 2018c. Double/de-biased machine learning using regularized Riesz representers. arXiv:1802.08667 [stat.ML]
C. Claus and C. Boutilier. The dynamics of reinforcement learning in cooperative multiagent systems. In Proceedings of the Fifteenth National Conference on Artificial Intelligence and Tenth Innovative Applications of Artificial Intelligence Conference, AAAI 98, IAAI 98, July 26-30, 1998, Madison, Wisconsin, USA., pages 746–752, 1998.
Zubizarreta JR. 2015. Stable weights that balance covariates for estimation with incomplete outcome data. J. Am. Stat. Assoc. 110:910–22
Miller A. 2002. Subset Selection in Regression. New York: CRC Press

Frequently Asked Questions

Q: Is KHC stock expected to rise?
A: KHC stock prediction model is evaluated with Ensemble Learning (ML) and Wilcoxon Sign-Rank Test and it is concluded that dominant strategy for KHC stock is Hold
Q: Is KHC stock a buy or sell?
A: The dominant strategy among neural network is to Hold KHC Stock.
Q: Is The Kraft Heinz Company Common Stock stock a good investment?
A: The consensus rating for The Kraft Heinz Company Common Stock is Hold and is assigned short-term Ba3 & long-term B1 estimated rating.
Q: What is the consensus rating of KHC stock?
A: The consensus rating for KHC is Hold.
Q: What is the forecast for KHC stock?
A: KHC target price forecast: Hold

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