The Kroger Co. (KR - Free Report) sports the highly coveted Zacks Rank #1 (Strong Buy) and resides within the Zacks Retail – Supermarkets Industry.
Kroger has undergone an extensive makeover, not only regarding products but also in terms of how consumers prefer shopping for groceries.
Founded in 1883, the long-time retailer operates approximately 2,700 retail stores under its various banners and divisions in 35 states.
Share Performance
Kroger shares have been a bright spot in an otherwise dim market throughout 2022, increasing nearly 5% in value and easily outperforming the S&P 500’s decline of almost 20%.
Upon widening the time frame to encompass a year’s worth of price action, the story remains the same – Kroger shares have enjoyed a stellar run, increasing nearly 30% in value and extensively outperforming the S&P 500 in this time frame as well.
The company’s share performance is inspiring – many companies have witnessed deep double-digit valuation slashes throughout 2022.
Quarterly Performance & Valuation
Kroger has been on a blazing-hot earnings streak, exceeding bottom-line expectations in ten consecutive quarters dating back to early 2020. In its latest quarter, in the face of adverse business conditions, the company beat earnings expectations by a substantial 13% and reported quarterly EPS of $1.45.
Furthermore, the average EPS surprise has been a strong 20% over its last four quarters.
In addition to strong quarterly performance, the grocery retailer sports attractive valuation levels. Its current forward earnings multiple resides at 12.3X, marginally below its five-year median value of 12.6X and nowhere near highs earlier this year of 16.4X.
Additionally, the value represents an enticing 28% discount relative to the S&P 500’s forward earnings multiple of 17.1X.
Growth Estimates
Analysts have primarily revised their earnings outlook positively over the last 60 days. For the upcoming quarter, the $0.81 per share estimate reflects a respectable 1.3% growth in earnings from the year-ago quarter.
Furthermore, the $3.91 per share estimate for the current fiscal year represents a sizable 6.3% expansion in the bottom-line year-over-year.
Quarterly revenue is forecasted to climb to $34 billion for the upcoming quarter, a substantial 7.3% increase compared to year-ago quarterly sales of $31.7 billion.
Pivoting to current fiscal year sales, the grocery retailer is penciled in to rake in a mighty $147 billion, a notable 6.7% increase in the top-line year-over-year.
Dividends
For investors who like to get paid, good news – Kroger has that covered with its annual dividend with a yield of 1.7% and a payout ratio sitting sustainably at 21% of earnings.
Impressively, the company has increased its dividend six times over the last five years, with a five-year annualized dividend growth rate of a double-digit 13%.
Additionally, the yield is notably higher than that of the S&P 500.
Bottom Line
One of the best ways investors can find expected winners within the market is by utilizing the Zacks Rank – one of the most potent market tools out there. A portfolio consisting of Zacks Rank #1 (Strong Buy) stocks has beaten the market in 26 of the last 31 years with an average annual return of 25%.
Additionally, the top 5% of all stocks receive the highly coveted Zacks Rank #1 (Strong Buy). These stocks should outperform the market more than any other rank.
Kroger (KR - Free Report) would be an excellent bet for investors looking to add a solid stock to their portfolios, as displayed by its Zack Rank #1 (Strong Buy).
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
The Kroger Co. (KR - Free Report) sports the highly coveted Zacks Rank #1 (Strong Buy) and resides within the Zacks Retail – Supermarkets Industry.
Kroger has undergone an extensive makeover, not only regarding products but also in terms of how consumers prefer shopping for groceries.
Founded in 1883, the long-time retailer operates approximately 2,700 retail stores under its various banners and divisions in 35 states.
Share Performance
Kroger shares have been a bright spot in an otherwise dim market throughout 2022, increasing nearly 5% in value and easily outperforming the S&P 500’s decline of almost 20%.
Upon widening the time frame to encompass a year’s worth of price action, the story remains the same – Kroger shares have enjoyed a stellar run, increasing nearly 30% in value and extensively outperforming the S&P 500 in this time frame as well.
The company’s share performance is inspiring – many companies have witnessed deep double-digit valuation slashes throughout 2022.
Quarterly Performance & Valuation
Kroger has been on a blazing-hot earnings streak, exceeding bottom-line expectations in ten consecutive quarters dating back to early 2020. In its latest quarter, in the face of adverse business conditions, the company beat earnings expectations by a substantial 13% and reported quarterly EPS of $1.45.
Furthermore, the average EPS surprise has been a strong 20% over its last four quarters.
In addition to strong quarterly performance, the grocery retailer sports attractive valuation levels. Its current forward earnings multiple resides at 12.3X, marginally below its five-year median value of 12.6X and nowhere near highs earlier this year of 16.4X.
Additionally, the value represents an enticing 28% discount relative to the S&P 500’s forward earnings multiple of 17.1X.
Growth Estimates
Analysts have primarily revised their earnings outlook positively over the last 60 days. For the upcoming quarter, the $0.81 per share estimate reflects a respectable 1.3% growth in earnings from the year-ago quarter.
Furthermore, the $3.91 per share estimate for the current fiscal year represents a sizable 6.3% expansion in the bottom-line year-over-year.
Quarterly revenue is forecasted to climb to $34 billion for the upcoming quarter, a substantial 7.3% increase compared to year-ago quarterly sales of $31.7 billion.
Pivoting to current fiscal year sales, the grocery retailer is penciled in to rake in a mighty $147 billion, a notable 6.7% increase in the top-line year-over-year.
Dividends
For investors who like to get paid, good news – Kroger has that covered with its annual dividend with a yield of 1.7% and a payout ratio sitting sustainably at 21% of earnings.
Impressively, the company has increased its dividend six times over the last five years, with a five-year annualized dividend growth rate of a double-digit 13%.
Additionally, the yield is notably higher than that of the S&P 500.
Bottom Line
One of the best ways investors can find expected winners within the market is by utilizing the Zacks Rank – one of the most potent market tools out there. A portfolio consisting of Zacks Rank #1 (Strong Buy) stocks has beaten the market in 26 of the last 31 years with an average annual return of 25%.
Additionally, the top 5% of all stocks receive the highly coveted Zacks Rank #1 (Strong Buy). These stocks should outperform the market more than any other rank.
Kroger (KR - Free Report) would be an excellent bet for investors looking to add a solid stock to their portfolios, as displayed by its Zack Rank #1 (Strong Buy).
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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