Will FDA Formula Warning and Recall Lapses Change Kroger’s (KR) Food Safety Narrative?

• In November 2025, the FDA warned Kroger after inspectors found recalled ByHeart infant formula linked to a multistate infant botulism outbreak still on sale across multiple Kroger-owned banners in several states, despite earlier recall notices.
• The letter raises serious questions about Kroger’s recall execution and food safety controls, highlighting potential legal exposure and reputational damage tied to its role in the contaminated infant formula supply chain.
• We’ll now examine how this FDA warning over recalled infant formula and Kroger’s recall processes may alter the company’s broader investment narrative.

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Kroger Investment Narrative Recap

To own Kroger, you need to believe its core grocery and digital operations can offset thin margins, heavy investment needs and recent earnings pressure. The FDA’s ByHeart warning adds a new near term risk, heightening regulatory and reputational pressure that could distract management from its biggest catalyst in e commerce and operations efficiency. The potential legal and compliance overhang is material enough that it now sits alongside labor cost inflation as a key watchpoint.

The most relevant recent update is Kroger’s Q3 2025 results, which showed a US$1,320m quarterly net loss and highlighted already tight profitability. Against that backdrop, an FDA warning over recalled infant formula introduces additional uncertainty around potential compliance costs or operational changes at a time when Kroger is trying to stabilize margins and keep its digital and store investment program on track.

Yet behind those headline numbers, investors also need to be aware that Kroger’s recall and food safety controls...

Read the full narrative on Kroger (it's free!)

Kroger’s narrative projects $158.1 billion revenue and $3.3 billion earnings by 2028. This requires 2.5% yearly revenue growth and a $0.7 billion earnings increase from $2.6 billion today.

Uncover how Kroger's forecasts yield a $73.52 fair value, a 18% upside to its current price.

Exploring Other Perspectives

Two members of the Simply Wall St Community currently see Kroger’s fair value in a tight US$73.52 to US$74.92 band, with little dispersion. Set that against the new FDA warning on Kroger’s recall execution, and you can see why many readers may want to weigh compliance and reputational risks before forming their own view on the company’s performance potential.

Explore 2 other fair value estimates on Kroger - why the stock might be worth just $73.52!

Build Your Own Kroger Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Kroger research is our analysis highlighting 2 key rewards and 4 important warning signs that could impact your investment decision.
• Our free Kroger research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Kroger's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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