Guggenheim raised the firm’s price target on Kroger (KR) to $61 from $60 and keeps a Buy rating on the shares. Kroger’s divestiture of its specialty Rx business “not only makes strategic sense,” but would provide incremental financial dry powder that could be returned to shareholders in the event that the Albertsons (ACI) acquisition does not go through following the trial scheduled for August, the analyst tells investors. The firm believes the divestiture will have a minimal P&L impact while further bolstering balance sheet strength and also shines a light on Kroger’s “true” non-fuel profitability, the analyst added.
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Read More on KR:
- Kroger (NYSE:KR) Agrees to Divest Specialty Pharmacy Unit
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- Kroger price target raised to $50 from $46 at Roth MKM
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