Citi analyst Paul Lejuez maintained a Hold rating on Kroger Company (KR – Research Report) yesterday and set a price target of $61.00.
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Paul Lejuez has given his Hold rating due to a combination of factors surrounding Kroger Company’s current situation. The unexpected departure of CEO Rodney McMullen, following an internal investigation into his conduct, has introduced a level of uncertainty within the company’s leadership. This change, coupled with the fact that the new CFO has yet to start, could lead to potential disruptions in the company’s operations.
Despite these leadership challenges, Kroger has reported that its fourth-quarter sales and earnings per share (EPS) are at the high end of the guidance range, slightly surpassing consensus expectations. However, the revised estimates for the fourth quarter show a slight decrease in gross margin and an increase in selling, general, and administrative expenses, which could impact profitability. These mixed signals contribute to the Hold rating, as the stock’s expected share price return is projected to be negative.
Lejuez covers the Consumer Cyclical sector, focusing on stocks such as Nike, Birkenstock Holding plc, and Deckers Outdoor. According to TipRanks, Lejuez has an average return of 8.5% and a 55.25% success rate on recommended stocks.
In another report released yesterday, BMO Capital also reiterated a Hold rating on the stock with a $63.00 price target.