| Snowflake Score | |
|---|---|
| Valuation | 2/6 |
| Future Growth | 2/6 |
| Past Performance | 0/6 |
| Financial Health | 3/6 |
| Dividends | 5/6 |
KR Overview
The Kroger Co. operates as a retailer in the United States.
Rewards
Risk Analysis
Kroger Competitors
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | US$40.94 |
| 52 Week High | US$30.35 |
| 52 Week Low | US$47.99 |
| Beta | 0.39 |
| 1 Month Change | -10.86% |
| 3 Month Change | 5.65% |
| 1 Year Change | 23.28% |
| 3 Year Change | 36.69% |
| 5 Year Change | 34.45% |
| Change since IPO | 2,030.21% |
Recent News & Updates
Kroger: Bull Thesis Revisited In 4 Charts
I first wrote about Kroger in June 2021 with a bull thesis considering its large upside potential (~50%) in the short term and double-digit total return potential in the. Since my last writing, there have been some changes both in its price and in the fundamentals. This article, therefore, provides an updated assessment of the analysis, and the conclusion is that our bull thesis is maintained.
Kroger Is Still Undervalued
While first quarter results were not really great, Kroger reported strong growth in the recent past. Management is using share buybacks and was also increasing its dividend in the double-digits in the last few years. Even without using overly optimistic growth assumptions, the stock seems to be still undervalued.
Shareholder Returns
| KR | US Consumer Retailing | US Market | |
|---|---|---|---|
| 7D | -4.1% | -0.9% | -0.6% |
| 1Y | 23.3% | 17.8% | 33.8% |
Return vs Industry: KR exceeded the US Consumer Retailing industry which returned 17.8% over the past year.
Return vs Market: KR underperformed the US Market which returned 33.8% over the past year.
Price Volatility
| KR volatility | |
|---|---|
| KR Beta | 0.39 |
| Industry Beta | 0.60 |
| Market Beta | 1 |
Stable Share Price: KR is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 4% a week.
Volatility Over Time: KR's weekly volatility (4%) has been stable over the past year.
About the Company
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 1883 | 500,000 | William McMullen | https://www.thekrogerco.com |
The Kroger Co. operates as a retailer in the United States. The company operates combination food and drug stores, multi-department stores, marketplace stores, and price impact warehouses. Its combination food and drug stores offer natural food and organic sections, pharmacies, general merchandise, pet centers, fresh seafood, and organic produce; and multi-department stores provide apparel, home fashion and furnishings, outdoor living, electronics, automotive products, and toys.
Kroger Fundamentals Summary
| KR fundamental statistics | |
|---|---|
| Market Cap | US$30.46b |
| Earnings (TTM) | US$1.13b |
| Revenue (TTM) | US$133.44b |
26.9x
P/E Ratio0.2x
P/S RatioIs KR overvalued?
See Fair Value and valuation analysisEarnings & Revenue
| KR income statement (TTM) | |
|---|---|
| Revenue | US$133.44b |
| Cost of Revenue | US$102.57b |
| Gross Profit | US$30.88b |
| Expenses | US$29.74b |
| Earnings | US$1.13b |
Last Reported Earnings
Aug 14, 2021
Next Earnings Date
n/a
| Earnings per share (EPS) | 1.49 |
| Gross Margin | 23.14% |
| Net Profit Margin | 0.85% |
| Debt/Equity Ratio | 152.9% |
How did KR perform over the long term?
See historical performance and comparisonDividends
2.1%
Current Dividend Yield50%
Payout RatioDoes KR pay a reliable dividends?
See KR dividend history and benchmarks| Kroger dividend dates | |
|---|---|
| Ex Dividend Date | Nov 12 2021 |
| Dividend Pay Date | Dec 01 2021 |
| Days until Ex dividend | 54 days |
| Days until Dividend pay date | 73 days |
Does KR pay a reliable dividends?
See KR dividend history and benchmarksValuation
Is Kroger undervalued compared to its fair value and its price relative to the market?
44.0%
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: KR ($40.94) is trading below our estimate of fair value ($73.05)
Significantly Below Fair Value: KR is trading below fair value by more than 20%.
Price To Earnings Ratio
PE vs Industry: KR is poor value based on its PE Ratio (26.9x) compared to the US Consumer Retailing industry average (20.8x).
PE vs Market: KR is poor value based on its PE Ratio (26.9x) compared to the US market (17.8x).
Price to Earnings Growth Ratio
PEG Ratio: KR is poor value based on its PEG Ratio (2.5x)
Price to Book Ratio
PB vs Industry: KR is overvalued based on its PB Ratio (3.3x) compared to the US Consumer Retailing industry average (2.3x).
Future Growth
How is Kroger forecast to perform in the next 1 to 3 years based on estimates from 22 analysts?
10.9%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: KR's forecast earnings growth (10.9% per year) is above the savings rate (2%).
Earnings vs Market: KR's earnings (10.9% per year) are forecast to grow slower than the US market (14.9% per year).
High Growth Earnings: KR's earnings are forecast to grow, but not significantly.
Revenue vs Market: KR's revenue (1.8% per year) is forecast to grow slower than the US market (9.8% per year).
High Growth Revenue: KR's revenue (1.8% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: KR's Return on Equity is forecast to be high in 3 years time (21.3%)
Past Performance
How has Kroger performed over the past 5 years?
-0.8%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: KR has a large one-off loss of $657.0M impacting its August 14 2021 financial results.
Growing Profit Margin: KR's current net profit margins (0.8%) are lower than last year (2%).
Past Earnings Growth Analysis
Earnings Trend: KR's earnings have declined by 0.8% per year over the past 5 years.
Accelerating Growth: KR's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: KR had negative earnings growth (-56.2%) over the past year, making it difficult to compare to the Consumer Retailing industry average (25%).
Return on Equity
High ROE: KR's Return on Equity (12.6%) is considered low.
Financial Health
How is Kroger's financial position?
Financial Position Analysis
Short Term Liabilities: KR's short term assets ($12.3B) do not cover its short term liabilities ($15.6B).
Long Term Liabilities: KR's short term assets ($12.3B) do not cover its long term liabilities ($23.6B).
Debt to Equity History and Analysis
Debt Level: KR's debt to equity ratio (152.9%) is considered high.
Reducing Debt: KR's debt to equity ratio has reduced from 177.2% to 152.9% over the past 5 years.
Debt Coverage: KR's debt is well covered by operating cash flow (32%).
Interest Coverage: KR's interest payments on its debt are well covered by EBIT (5x coverage).
Balance Sheet
Dividend
What is Kroger current dividend yield, its reliability and sustainability?
2.05%
Current Dividend Yield
Upcoming Dividend Payment
Dividend Yield vs Market
Notable Dividend: KR's dividend (2.05%) is higher than the bottom 25% of dividend payers in the US market (1.33%).
High Dividend: KR's dividend (2.05%) is low compared to the top 25% of dividend payers in the US market (3.6%).
Stability and Growth of Payments
Stable Dividend: KR's dividends per share have been stable in the past 10 years.
Growing Dividend: KR's dividend payments have increased over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its reasonable payout ratio (50.3%), KR's dividend payments are covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: KR's dividends in 3 years are forecast to be well covered by earnings (29.8% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
4.3yrs
Average management tenure
CEO
William McMullen (60 yo)
7.67yrs
Tenure
US$22,373,574
Compensation
Mr. William Rodney McMullen served as Independent Director of Cincinnati Financial Corporation since 2001 until May 2020. He served as Director at The Cincinnati Life Insurance Company. Mr. McMullen has wo...
CEO Compensation Analysis
Compensation vs Market: William's total compensation ($USD22.37M) is above average for companies of similar size in the US market ($USD11.36M).
Compensation vs Earnings: William's compensation has been consistent with company performance over the past year.
Leadership Team
Experienced Management: KR's management team is considered experienced (4.3 years average tenure).
Board Members
Experienced Board: KR's board of directors are considered experienced (3.3 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: KR insiders have only sold shares in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
The Kroger Co.'s employee growth, exchange listings and data sources
Key Information
- Name: The Kroger Co.
- Ticker: KR
- Exchange: NYSE
- Founded: 1883
- Industry: Food Retail
- Sector: Consumer Retailing
- Market Cap: US$30.459b
- Shares outstanding: 744.00m
- Website: https://www.thekrogerco.com
Number of Employees
Location
- The Kroger Co.
- 1014 Vine Street
- Cincinnati
- Ohio
- 45202-1100
- United States
Listings
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2021/09/18 22:02 |
| End of Day Share Price | 2021/09/17 00:00 |
| Earnings | 2021/08/14 |
| Annual Earnings | 2021/01/30 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.