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Shares of The Kroger Co. (KR - Analyst Report) reached a 52-week high of $50.20 yesterday following the company’s better-than-expected first-quarter fiscal 2014 results and upbeat outlook. Shares gained over 5% on the index before closing at $49.66. Year to date, the stock has increased 27.4%.

The quarterly results were driven by the company’s Customer 1st strategy and acquisition of Harris Teeter. The company posted earnings of $1.09 per share that surpassed the Zacks Consensus Estimate of $1.05, and surged 18.5% year over year. Total sales (including fuel center sales) grew 9.9% to $32,961 million from the prior-year quarter, and also came ahead of the Zacks Consensus Estimate of $32,636 million. Management stated that excluding fuel center sales, total sales rose 11.4%. Including the most recent quarter, the company has beaten the Zacks Consensus Estimate by an average of 4.4% in the trailing four quarters.

Consequently, management raised its fiscal 2014 guidance. Cincinnati-based Kroger now projects fiscal 2014 earnings in the band of $3.19 to $3.27 per share, up from its earlier predicted range of $3.14 to $3.25. The current Zacks Consensus Estimate for fiscal 2014 is $3.22, which could witness an uptrend in the coming days.

Kroger, one of the largest grocery store retailers, has maintained its strong performance despite a challenging macroeconomic backdrop primarily due to sturdy super market sales growth. Quarterly identical supermarket sales (stores that are open without expansion or relocation for 5 full quarters) excluding fuel center sales, increased 4.6% to $24,949 million.

Kroger now envisions identical supermarket sales (excluding fuel) growth of 3% to 4% for fiscal 2014, up from the previous projection of 2.5% to 3.5%.

Further, management continues to deploy capital to concentrate more on remodeling, merchandising and other viable projects. Moreover, acquisitions including that of Harris Teeter will continue to boost the company’s momentum.

Currently, Kroger carries a Zacks Rank #2 (Buy). Other stocks worth considering in the retail sector include Inventure Foods, Inc. (SNAK - Snapshot Report), The Hain Celestial Group, Inc. (HAIN - Analyst Report) and Sprouts Farmers Market, Inc. (SFM - Snapshot Report), all carrying a Zacks Rank #2.

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