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Kroger (KR) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, Kroger (KR) closed at $35.39, marking a +0.83% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.36%. At the same time, the Dow added 0.62%, and the tech-heavy Nasdaq gained 0.35%.

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 $0.50, up 13.64% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $29.66 billion, up 5.31% from the year-ago period.

KR's full-year Zacks Consensus Estimates are calling for earnings of $2.84 per share and revenue of $129.22 billion. These results would represent year-over-year changes of +29.09% and +5.67%, respectively.

Any recent changes to analyst estimates for KR should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about 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. Within the past 30 days, our consensus EPS projection has moved 0.24% higher. KR is currently sporting a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that KR has a Forward P/E ratio of 12.35 right now. This valuation marks a discount compared to its industry's average Forward P/E of 17.78.

Investors should also note that KR has a PEG ratio of 2.25 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Retail - Supermarkets was holding an average PEG ratio of 2.59 at yesterday's closing price.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 105, which puts it in the top 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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