Kraft Heinz is feeling the squeeze as the brand falls behind food consumption trends and faces other mounting struggles, Wolfe Research analyst Scott Mushkin told CNBC on Friday.

Management is catching heat from its connection to cost-cutting private-equity giant 3G Capital, but the food and beverage giant's revamp of products such as Oscar Mayer is just falling short, he said.

"I think the challenge for Kraft Heinz goes well beyond just a one-company situation. It goes to what's going on with food producers here in the U.S., and we think the environment is just awful," he said on "Closing Bell."

The company needs to find a new recipe as population and healthy eating trends noticeably alter consumption habits, he said, pointing out declining birth rates and increasingly popular "pure food" campaigns such as Meatless Monday.

"So [there are] just a lot, a lot, of challenges, not to mention private label, so the company faces enormous challenges," Mushkin said. "They have reinvested in their brands, but it's just not working and it's maybe even worse because it's not working than if they were just cutting costs and not reinvesting."

Jeff Robards, the global head of consumer food at Alantra who also appeared in the "Closing Bell" segment, said large food companies could address those trends with the right growth strategy. But the problem for Kraft Heinz, he said, is that throwing marketing dollars won't find the pulse of consumers quite like innovation.

That has instead allowed entrepreneurs and smaller companies to grow, he said.

"It's not the big food companies [growing], because they just aren't close enough to the consumer to figure these things out," Robards said. "And you see efforts by all of these companies to try to do that, but I think the problem is they can't effectively get out of their historical way of doing business in order to kind of tap in to all those trends and all that growth."

Mushkin said it's time for Kraft Heinz to acquire a smaller company. His firm still has an outperform rating for the stock and a $62 price target, which is more than 77 percent higher than its Friday closing price.

"Could we please get some M&A in this space," he said. "And man, do we need consolidation, but the family structures actually prevent some of it, but you know let's hope we get some because we need it in this space."

Kraft Heinz tanked more than 27 percent Friday, its worst daily performance ever. The stock had two negative sessions in a row after it slashed its dividend, wrote down some of its key brands, and revealed it's being investigated by the SEC.

Fourth-quarter earnings and revenue also fell below Wall Street's expectations.