KRAFT FOODS INC. $38 - New York symbol KFT

KRAFT FOODS INC. $38 (New York symbol KFT; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 1.8 billion; Market cap: $64.8 billion; Price-to-sales ratio: 1.3; Dividend yield: 3.1%; TSINetwork Rating: Above Average; www.kraft.com) plans to break itself into two separate, publicly traded companies by the end of 2012.

One company, called Mondelez International, will sell snack foods, such as Oreo cookies and Cadbury chocolates. The other, called Kraft Foods Group, will consist of Kraft’s slower-growing grocery business.

Kraft hasn’t announced the details of the split, but the Internal Revenue Service has confirmed that the break-up will be a tax-free transaction: shareholders won’t have to pay capital gains taxes until they sell their new shares.

Kraft Foods is a buy.

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