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Kroger (KR) Gains But Lags Market: What You Should Know

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·3 min read
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In the latest trading session, Kroger (KR) closed at $36.60, marking a +0.03% move from the previous day. This change lagged the S&P 500's 0.99% gain on the day.

Coming into today, shares of the supermarket chain had lost 2.03% in the past month. In that same time, the Retail-Wholesale sector lost 3.17%, while the S&P 500 lost 0.26%.

Wall Street will be looking for positivity from KR as it approaches its next earnings report date. The company is expected to report EPS of $0.99, down 18.85% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $39.22 billion, down 5.6% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.83 per share and revenue of $129.79 billion, which would represent changes of -18.44% and -2.04%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for KR. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. KR currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that KR has a Forward P/E ratio of 12.94 right now. This valuation marks a discount compared to its industry's average Forward P/E of 13.66.

We can also see that KR currently has a PEG ratio of 2.03. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. KR's industry had an average PEG ratio of 2.22 as of yesterday's close.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 124, putting it in the top 49% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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