Kroger upgraded to Outperform from Market Perform at BMO Capital

BMO Capital upgraded Kroger (KR) to Outperform from Market Perform with a price target of $60, up from $58. The stock has pulled back on fear over increasing price investments across the space, but the firm believes these are largely vendor-funded with a smaller component of retailer-funded promotions and believes Kroger’s positioning allows it to continue managing the competitive environment with stable gross margins. In addition, the firm sees the pending Albertsons (ACI) deal as “a win-win under either a deal or no-deal scenario,” noting that it raised its FY25 and FY26 EPS estimates and adding that it estimates higher year-one EPS accretion under a no-deal scenario.