Kroger (NYSE:KR) Announces Earnings Results, Beats Expectations By $0.04 EPS

Kroger (NYSE:KR) announced its earnings results on Friday. The company reported $1.09 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.05 by $0.04, reports. The business had revenue of $34.62 billion during the quarter, compared to analyst estimates of $34.64 billion. Kroger had a return on equity of 44.33% and a net margin of 0.71%.Kroger’s revenue for the quarter was up 2.0% compared to the same quarter last year. During the same period last year, the company earned $1.04 EPS. Kroger updated its FY 2026 guidance to 5.100-5.300 EPS.

Here are the key takeaways from Kroger’s conference call:

• Sales outlook was reduced: Kroger lowered full-year identical sales growth without fuel guidance to 0.2%-0.8% from 1%-2%, citing consumer pressure, lingering Cyclospora effects, pharmacy pricing headwinds, and tougher comparisons later in the year.
• Despite soft sales, Kroger maintained adjusted FIFO operating profit guidance of $5.0-$5.2 billion and adjusted EPS guidance of $5.10-$5.30, supported by cost savings, margin management, pharmacy mix, and expected earnings growth in the second half.
• E-commerce and retail media continued to accelerate. Adjusted e-commerce sales rose 20% with a second consecutive quarter of profitable growth, while retail media increased 24% and monetization improved 88 basis points.
• Kroger reported continued momentum in Our Brands, particularly Private Selection and Simple Truth; Our Brand sales grew faster than national brands, penetration increased approximately 50 basis points, and Private Selection sales rose more than 14%.
• Management emphasized a multi-year customer value plan combining lower prices and simpler promotions with sourcing, procurement, and productivity savings. The company also resumed share repurchases, buying back approximately $1.2 billion of stock in the first half, while continuing to expect the Giant Eagle acquisition to close in 2027 subject to regulatory review.

Kroger Stock Up 2.7%

Shares of NYSE KR opened at $58.50 on Friday. The company has a quick ratio of 0.39, a current ratio of 0.79 and a debt-to-equity ratio of 2.43. The firm has a market cap of $35.84 billion, a PE ratio of 34.41, a P/E/G ratio of 1.59 and a beta of 0.41. The company’s fifty day simple moving average is $57.78 and its 200 day simple moving average is $63.66. Kroger has a 12-month low of $54.15 and a 12-month high of $76.58.

Kroger Increases Dividend

The business also recently announced a quarterly dividend, which was paid on Tuesday, September 1st. Investors of record on Saturday, August 15th were paid a dividend of $0.39 per share. This is a boost from Kroger’s previous quarterly dividend of $0.35. This represents a $1.56 annualized dividend and a yield of 2.7%. The ex-dividend date of this dividend was Friday, August 14th. Kroger’s payout ratio is currently 91.76%.

Hedge Funds Weigh In On Kroger

A number of institutional investors and hedge funds have recently made changes to their positions in the stock. State Street Corp lifted its position in shares of Kroger by 1.2% during the third quarter. State Street Corp now owns 31,948,112 shares of the company’s stock valued at $2,153,622,000 after purchasing an additional 386,503 shares in the last quarter. GQG Partners LLC grew its position in Kroger by 11.3% in the 4th quarter. GQG Partners LLC now owns 13,398,072 shares of the company’s stock worth $837,113,000 after purchasing an additional 1,360,946 shares in the last quarter. Dimensional Fund Advisors LP increased its stake in Kroger by 1.0% in the 4th quarter. Dimensional Fund Advisors LP now owns 12,242,401 shares of the company’s stock valued at $764,932,000 after buying an additional 122,606 shares during the last quarter. Invesco Ltd. increased its stake in Kroger by 7.7% in the 4th quarter. Invesco Ltd. now owns 6,816,240 shares of the company’s stock valued at $425,879,000 after buying an additional 489,058 shares during the last quarter. Finally, UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC lifted its position in shares of Kroger by 3.7% during the 4th quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 6,076,142 shares of the company’s stock worth $379,637,000 after buying an additional 216,728 shares in the last quarter. Institutional investors own 80.93% of the company’s stock.

More Kroger News

Here are the key news stories impacting Kroger this week:

• Positive Sentiment: Kroger reported second-quarter adjusted EPS of $1.09, above the approximately $1.05 analyst consensus and up from $1.04 a year earlier. Operating profit increased to $971 million, while adjusted eCommerce sales grew 20% and Kroger Precision Marketing profit rose 24%. Kroger Reports Second Quarter 2026 Results and Updates Guidance for 2026
• Positive Sentiment: Management reaffirmed fiscal 2026 adjusted EPS guidance of $5.10–$5.30, signaling confidence that cost savings, pharmacy and fuel performance, eCommerce and margin management can offset sluggish sales. Kroger also repurchased $1 billion of stock during the quarter. Kroger gains as profit outlook holds despite softer sales guidance
• Positive Sentiment: Unusually heavy call-option activity indicated that some traders were positioning for additional upside following the earnings release.
• Neutral Sentiment: Revenue rose 2% year over year to $34.62 billion but was slightly below estimates. Identical sales excluding fuel increased only 0.2%, reflecting cautious consumer spending and the impact of the Inflation Reduction Act on pharmacy revenue. Kroger Reports Second Quarter 2026 Results and Updates Guidance for 2026
• Negative Sentiment: Kroger cut its fiscal-year identical-sales outlook excluding fuel to 0.2%–0.8%, down from 1%–2%. Executives cited inflation, intense grocery competition and strained household budgets, including elevated gasoline costs and reduced government food assistance. Kroger Cuts Sales View Due to Macro Challenges
• Negative Sentiment: A cyclospora outbreak reduced fresh-produce shopping during the quarter, while reports that Boar’s Head meats are disappearing from some stores could create additional deli-sales and customer-retention concerns. Cyclospora outbreak hammers Kroger sales as shoppers avoided produce

Analysts Set New Price Targets

A number of brokerages have recently issued reports on KR. Telsey Advisory Group set a $78.00 price target on shares of Kroger and gave the stock an “outperform” rating in a research report on Monday, June 22nd. Royal Bank Of Canada reiterated an “outperform” rating on shares of Kroger in a research report on Monday, June 1st. Wells Fargo & Company set a $58.00 target price on shares of Kroger in a research note on Monday, June 22nd. UBS Group restated a “neutral” rating on shares of Kroger in a report on Friday, September 4th. Finally, Citigroup reaffirmed a “neutral” rating and set a $57.00 price target (down from $61.00) on shares of Kroger in a research report on Tuesday, September 1st. Ten investment analysts have rated the stock with a Buy rating and nine have given a Hold rating to the stock. According to MarketBeat, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $71.31.

About Kroger

The Kroger Co (NYSE: KR) is one of the largest grocery retailers in the United States. Founded in Cincinnati in 1883 by Bernard Kroger, the company operates supermarkets, multi-department stores, pharmacies, convenience stores and fuel centers across the country.

Kroger sells a broad range of fresh foods, packaged groceries, household products, health and beauty items, prepared foods and general merchandise. Its private-label offerings include Simple Truth, Private Selection and Kroger brands.