Kroger (KR) Upgraded to “Hold” at Zacks Investment Research

Kroger (NYSE:KR) was upgraded by Zacks Investment Research from a “sell” rating to a “hold” rating in a note issued to investors on Friday, November 10th.

According to Zacks, “Stiff competition, volatility in food prices, aggressive promotional environment and waning store traffic are making things tough for Kroger that underperformed the industry in the past six months. This is quite evident from second-quarter fiscal 2017 results, wherein bottom line continues to decline year over year for the fourth straight quarter. On the contrary, top line continues to improve fueled by Customer 1st strategy, digital efforts and recent buyouts, and also came ahead of the estimate for the fourth quarter in row. The company’s dominant position among grocery retailers enables it to sustain sales growth. However, higher investments in new services and compelling pricing strategy may hurt margins. Further, a high debt load also remains a concern. Management as a part of “Restock Kroger” plan is considering the sale of convenience store business and had also reiterated its fiscal 2017 earnings per share view.”

Other equities research analysts also recently issued research reports about the stock. Jefferies Group dropped their target price on shares of Kroger from $24.00 to $19.00 and set a “hold” rating for the company in a research report on Monday, September 11th. BidaskClub raised shares of Kroger from a “sell” rating to a “hold” rating in a research report on Monday, July 31st. Vetr raised shares of Kroger from a “buy” rating to a “strong-buy” rating and set a $27.01 target price for the company in a research report on Wednesday, August 9th. UBS downgraded shares of Kroger from an “outperform” rating to a “market perform” rating in a research report on Friday, September 8th. Finally, Hilliard Lyons reaffirmed a “buy” rating and set a $30.00 price objective on shares of Kroger in a research report on Tuesday, September 12th. Nineteen research analysts have rated the stock with a hold rating, nine have given a buy rating and one has assigned a strong buy rating to the company. Kroger presently has a consensus rating of “Hold” and an average target price of $29.10.

Kroger (NYSE KR) traded up $0.82 during trading hours on Friday, hitting $24.38. 20,944,398 shares of the company traded hands, compared to its average volume of 12,086,781. Kroger has a 1-year low of $19.69 and a 1-year high of $36.44. The firm has a market cap of $20,960.00, a price-to-earnings ratio of 12.03, a price-to-earnings-growth ratio of 2.88 and a beta of 0.83. The company has a debt-to-equity ratio of 2.13, a current ratio of 0.87 and a quick ratio of 0.33.

Kroger (NYSE:KR) last released its quarterly earnings results on Friday, September 8th. The company reported $0.39 earnings per share (EPS) for the quarter, hitting the Thomson Reuters’ consensus estimate of $0.39. Kroger had a net margin of 1.32% and a return on equity of 28.04%. The firm had revenue of $27.60 billion for the quarter, compared to the consensus estimate of $27.48 billion. During the same quarter in the previous year, the firm posted $0.47 EPS. The firm’s quarterly revenue was up 3.9% on a year-over-year basis. equities research analysts forecast that Kroger will post 1.99 EPS for the current year.

Several hedge funds and other institutional investors have recently added to or reduced their stakes in KR. Howe & Rusling Inc. acquired a new stake in shares of Kroger during the third quarter valued at approximately $103,000. Dupont Capital Management Corp acquired a new stake in shares of Kroger during the second quarter valued at approximately $105,000. Cedar Wealth Management LLC raised its holdings in shares of Kroger by 155.9% during the second quarter. Cedar Wealth Management LLC now owns 4,990 shares of the company’s stock valued at $116,000 after acquiring an additional 3,040 shares during the period. CWM LLC raised its holdings in shares of Kroger by 1,162.2% during the second quarter. CWM LLC now owns 5,213 shares of the company’s stock valued at $122,000 after acquiring an additional 4,800 shares during the period. Finally, Grove Bank & Trust raised its holdings in shares of Kroger by 9.3% during the second quarter. Grove Bank & Trust now owns 5,287 shares of the company’s stock valued at $124,000 after acquiring an additional 450 shares during the period. Institutional investors and hedge funds own 79.16% of the company’s stock.

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Kroger Company Profile

The Kroger Co (Kroger) manufactures and processes food for sale in its supermarkets. The Company operates supermarkets, multi-department stores, jewelry stores and convenience stores throughout the United States. As of January 28, 2017, it had operated approximately 4,000 owned or leased supermarkets, convenience stores, fine jewelry stores, distribution warehouses and food production plants through divisions, subsidiaries or affiliates.

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