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Kroger (KR) Stock Drops Despite Market Gains: Important Facts to Note

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Kroger (KR - Free Report) closed the most recent trading day at $67.83, moving -1.11% from the previous trading session. The stock fell short of the S&P 500, which registered a gain of 2.05% for the day. At the same time, the Dow added 1.78%, and the tech-heavy Nasdaq gained 2.47%.

Coming into today, shares of the supermarket chain had lost 2.53% in the past month. In that same time, the Retail-Wholesale sector gained 4.47%, while the S&P 500 gained 5.21%.

The investment community will be closely monitoring the performance of Kroger in its forthcoming earnings report. The company is predicted to post an EPS of $1.44, indicating a 0.7% growth compared to the equivalent quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $45.38 billion, reflecting a 0.25% rise from the equivalent quarter last year.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $4.74 per share and a revenue of $149.08 billion, indicating changes of +6.04% and +1.33%, respectively, from the former year.

Investors should also take note of any recent adjustments to analyst estimates for Kroger. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. 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, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Kroger is currently a Zacks Rank #3 (Hold).

Investors should also note Kroger's current valuation metrics, including its Forward P/E ratio of 14.46. This represents a discount compared to its industry's average Forward P/E of 15.07.

One should further note that KR currently holds a PEG ratio of 2.05. 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. As the market closed yesterday, the Retail - Supermarkets industry was having an average PEG ratio of 1.83.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 52, which puts it in the top 22% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


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