Kroger (NYSE:KR) Has A Somewhat Strained Balance Sheet
Warren Buffett famously said, 'Volatility is far from synonymous with risk.' So it seems the smart money knows that...
Has the U.S. Food and Staples Retail Industry valuation changed over the past few years?
|Thu, 09 Dec 2021||US$806.8b||US$1.4t||US$17.0b||21.7x|
|Sat, 06 Nov 2021||US$838.5b||US$1.3t||US$19.3b||21.7x|
|Mon, 04 Oct 2021||US$759.1b||US$1.3t||US$19.5b||19.6x|
|Wed, 01 Sep 2021||US$801.6b||US$1.3t||US$19.4b||21.7x|
|Thu, 08 Jul 2021||US$752.2b||US$1.3t||US$20.9b||17.2x|
|Wed, 31 Mar 2021||US$706.8b||US$1.3t||US$21.2b||14.8x|
|Sat, 02 Jan 2021||US$716.8b||US$1.2t||US$27.4b||14.2x|
|Tue, 06 Oct 2020||US$647.8b||US$1.2t||US$26.0b||13.4x|
|Fri, 10 Jul 2020||US$573.5b||US$1.1t||US$22.4b||18.7x|
|Thu, 02 Apr 2020||US$560.1b||US$1.1t||US$24.8b||20.7x|
|Sun, 05 Jan 2020||US$622.3b||US$1.1t||US$25.3b||24.7x|
|Wed, 09 Oct 2019||US$609.7b||US$1.1t||US$24.2b||23.9x|
|Tue, 02 Jul 2019||US$566.1b||US$1.1t||US$20.5b||20.6x|
|Fri, 05 Apr 2019||US$528.3b||US$1.1t||US$20.1b||18.5x|
|Mon, 07 Jan 2019||US$506.5b||US$1.1t||US$19.5b||18.9x|
Current Industry PE: Investors are relatively neutral on the industry at the moment, considering it's trading close to its 3-year average PE ratio of 19.1x. It appears they believe that earnings will grow in-line with historical growth rates.
Past Earnings Growth: The earnings for companies in the Consumer Retailing industry have declined 4.4% per year over the last three years, while revenues for these companies have grown 7.5% per year. This means that although more sales are being generated, either the cost of doing business or the level of investment back into businesses has increased, which has decreased profits.
Which industries have driven the changes within the U.S. Food and Staples Retail industry?
|Big Box Super Stores||-0.67%|
Industry PE: Investors are most optimistic about the Big Box Super Stores industry which is trading above its 3-year average PE ratio of 28.8x. However analysts are expecting annual earnings growth of 11%, which is lower than the prior year's growth of 19% per year. So the market might believe that analysts are underestimating future growth. Meanwhile, investors are most pessimistic about the Food Retail industry, which is trading close to its 3-year average of 15.6x.
Forecasted Growth: Analysts are most optimistic on the Food Distributors industry, expecting annual earnings growth of 21% over the next 5 years. This is better than its past earnings decline of 0.8% per year. Meanwhile, the Food Retail industry is expected to see its earnings grow by 10% per year over the next few years.
Which companies have driven the market over the last 7 days?
United Natural Foods
G. Willi-Food International
US Foods Holding
BJ's Wholesale Club Holdings
Performance Food Group
Sysco’s 3Q21 earnings reveal the firm’s “moat” is getting larger and could lead to years of profit growth. Sysco’s scale allows it to mitigate supply chain disruptions in serving its customers. Management notes it is able “to deliver higher fill rates for customers than the industry average." Assuming a return to pre-COVID margins and meeting consensus revenue estimates, the stock is worth $103/share today – 36% above the current price.
Casey's General Stores
Sprouts Farmers Market
Given the company’s strong market position and cheap valuation, we continue to see upside in the stock. This company is more profitable than it was pre-pandemic and is expanding its reach in the fast-growing health and wellness and natural/organic grocery markets. The demand for health and wellness products, along with natural and organic products, is growing at a rapid pace that provides Sprouts a long-term runway for growth.
Walgreens Boots Alliance
Dingdong’s revenue doubled in the third quarter, but its loss grew even faster by 1.4 times as it became trapped in a cycle of ‘greater losses with more income’. The company’s management admitted returns on investment are still a long way off. For now, we know the company has grown bigger and is now a clear leader in the vast China market.
Splash Beverage Group