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Kroger Company
(NYSE:KR)
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Rating:54Neutral
Price Target:
$66.00
▲(12.92% Upside)
Action:Reiterated
Date:10/06/26
KR’s score is primarily weighed down by balance-sheet leverage and thin/volatile profitability despite resilient scale and steady cash generation. The latest earnings call supports the outlook with maintained profit/EPS guidance and strong progress in e-commerce, retail media, and cost savings, but reduced identical sales guidance and ongoing cost/sales headwinds temper the upside. Technically, indicators are neutral, and valuation remains a drag due to the high P/E relative to the business profile.
Positive Factors
Consistent cash generation
Kroger’s recurring operating cash flow and consistently positive free cash flow provide internal funding for store investment, digital capabilities, debt service and shareholder returns. This cash-generation base supports resilience through changing grocery demand, although recent free cash flow moderation warrants monitoring.
Negative Factors
Elevated financial leverage
The sharply thinner equity cushion makes Kroger’s returns and financial flexibility more sensitive to earnings volatility or margin pressure. Higher leverage can also constrain capital allocation, increase refinancing exposure and reduce the company’s ability to absorb prolonged operating weakness.
Read all positive and negative factors
Positive Factors
Negative Factors
Consistent cash generation
Kroger’s recurring operating cash flow and consistently positive free cash flow provide internal funding for store investment, digital capabilities, debt service and shareholder returns. This cash-generation base supports resilience through changing grocery demand, although recent free cash flow moderation warrants monitoring.
Read all positive factors
Kroger Company Key Performance Indicators (KPIs)
Any
Store Count
Indicates the total number of retail locations, highlighting the company's market reach and potential for customer engagement. A growing store count can signal expansion and increased market penetration.
Indicates the total number of retail locations, highlighting the company's market reach and potential for customer engagement. A growing store count can signal expansion and increased market penetration.
Data provided by:
The Fly
The FlyKroger Company (KR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$38.94B
Dividend Yield2.18%
Average Volume (3M)7.74M
Price to Earnings (P/E)35.6
Beta (1Y)-0.27
Revenue Growth1.58%
EPS Growth-53.21%
CountryUS
Employees403,000
SectorConsumer Defensive
Sector Strength42
IndustryGrocery Stores
Share Statistics
EPS (TTM)1.85
Shares Outstanding590,588,700
10 Day Avg. Volume7,309,592
30 Day Avg. Volume7,736,037
Financial Highlights & Ratios
PEG Ratio-0.70
Price to Book (P/B)6.91
Price to Sales (P/S)0.28
P/FCF Ratio12.23
Enterprise Value/Market Cap1.44
Enterprise Value/Revenue0.37
Enterprise Value/Gross Profit1.62
Enterprise Value/Ebitda10.08
Forecast
1Y Price Target
$69.56Price Target Upside19.00% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering19
EPS Forecast (FY)5.19
Revenue Forecast (FY)$150.83B
Kroger Company Business Overview & Revenue Model
Company Description
The Kroger Co. functions as a significant retail entity throughout the United States, encompassing a varied collection of store formats. Its operations include integrated food and drug stores, which stock a broad range of products from natural and...
How the Company Makes Money
Kroger primarily makes money by selling consumer goods through its retail stores and digital channels. The largest revenue stream is retail sales of food and everyday essentials, including fresh items (e.g., produce and meat), packaged groceries, ...
Kroger Company Earnings Call Summary
Earnings Call Date:Sep 11, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 26, 2026
Earnings Call Sentiment Positive
The call was broadly positive on execution and profitability, with strong e-commerce, retail media, private-label brands, cost savings, gross-margin performance, market-share progress, cash flow and balance-sheet flexibility. However, sales growth was weak, full-year identical sales guidance was reduced, and the company faces ongoing pressure from cyclospora, pharmacy changes, consumer budget constraints, shrink, transportation costs and softer fuel margins. The highlights significantly outweigh the lowlights because Kroger maintained its full-year profit and EPS outlook while reporting progress across multiple strategic initiatives.Positive Updates
Profit Delivery Despite Softer Sales
Adjusted FIFO operating profit was $1.1 billion, and adjusted earnings per diluted share was $1.09, representing 5% growth versus last year. Management said the company delivered the profit it committed to despite a softer top line.
Negative Updates
Soft Identical Sales Growth
Identical sales without fuel grew 0.2%. Sales tracked well through most of the quarter but were affected in the final period by the cyclospora outbreak.
Read all updates
Q2-2026 Updates
Positive
Negative
Profit Delivery Despite Softer Sales
Adjusted FIFO operating profit was $1.1 billion, and adjusted earnings per diluted share was $1.09, representing 5% growth versus last year. Management said the company delivered the profit it committed to despite a softer top line.
Read all positive updates
Company Guidance
Kroger lowered full year identical sales without fuel guidance to a new range of 0.2% to 0.8% from its initial range of 1% to 2%, while maintaining adjusted FIFO operating profit guidance of $5 billion to $5.2 billion and adjusted net earnings per diluted share guidance of $5.10 to $5.30; it expects ID sales without fuel to be slightly better in Q3 than in Q4, consistent year over year earnings growth between the third and fourth quarters, cost saving initiatives to build through the second half, FIFO gross margin growth to be positive, on a full year basis, and gross margin to be positive through the second half of the year, with inflation within this 1 to 2.5 range for the balance of the year and below CPI, while the Inflation Reduction Act headwind is projected to accelerate to approximately 150 basis points in the fourth quarter, with no impact on profit in the fourth quarter, or in 2027; fuel margins are expected to be softer than H1, and after repurchasing approximately $1.2 billion of shares under the existing $2 billion authorization, Kroger expects to complete the remaining repurchases during the second half of the year and continues to expect the Giant Eagle transaction to close in 2027.Kroger Company Financial Statement Overview
Summary
Income Statement
56
Neutral
Balance Sheet
44
Neutral
Cash Flow
63
Positive
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 149.33B | 147.64B | 147.12B | 150.04B | 148.26B | 137.89B |
| Gross Profit | 34.51B | 34.40B | 33.40B | 33.36B | 31.78B | 30.35B |
| EBITDA | 5.55B | 5.76B | 7.64B | 7.03B | 7.02B | 6.05B |
| Net Income | 1.08B | 1.02B | 2.67B | 2.16B | 2.24B | 1.66B |
Balance Sheet | ||||||
| Total Assets | 49.49B | 49.94B | 52.62B | 50.51B | 49.62B | 49.09B |
| Cash, Cash Equivalents and Short-Term Investments | 1.68B | 4.58B | 5.27B | 3.10B | 2.14B | 2.90B |
| Total Debt | 24.16B | 24.68B | 25.08B | 19.25B | 20.41B | 20.44B |
| Total Liabilities | 43.65B | 44.01B | 44.34B | 38.90B | 39.61B | 39.66B |
| Stockholders Equity | 5.84B | 5.93B | 8.29B | 11.62B | 10.04B | 9.45B |
Cash Flow | ||||||
| Free Cash Flow | 2.27B | 3.35B | 1.78B | 2.88B | 1.23B | 3.58B |
| Operating Cash Flow | 6.60B | 7.21B | 5.79B | 6.79B | 4.31B | 6.19B |
| Investing Cash Flow | -4.20B | -3.91B | -3.23B | -3.75B | -3.02B | -2.61B |
| Financing Cash Flow | -5.67B | -3.98B | -490.00M | -2.17B | -2.29B | -3.44B |
Kroger Company Technical Analysis
Positive
58.45
Price Trends
60.43
Positive
59.24
Positive
63.12
Positive
Market Momentum
1.78
Negative
61.84
Neutral
56.21
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KR, the sentiment is Positive. The current price of 58.45 is below the 20-day moving average (MA) of 62.98, below the 50-day MA of 60.43, and below the 200-day MA of 63.12, indicating a bullish trend. The MACD of 1.78 indicates Negative momentum. The RSI at 61.84 is Neutral, neither overbought nor oversold. The STOCH value of 56.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KR.
Kroger Company Risk Analysis
Kroger Company disclosed 13 risk factors in its most recent earnings report. Kroger Company reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Kroger Company Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $4.43B | 9.14 | 33.82% | ― | 5.25% | 0.53% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
62 Neutral | $1.55B | 14.89 | 6.30% | 0.79% | 1.02% | 84.32% | |
61 Neutral | $1.85B | 19.04 | 7.15% | 1.82% | 4.50% | -3.08% | |
54 Neutral | $38.94B | 35.64 | 17.17% | 2.18% | 1.58% | -53.21% | |
54 Neutral | $6.02B | -426.33 | -2.78% | 5.16% | 2.26% | -106.73% | |
53 Neutral | $1.28B | -3.33 | -40.07% | ― | 5.12% | -4889.01% |
* Consumer Defensive Sector Average
KR
Kroger Company
65.93
1.95
3.05%
IMKTA
Ingles Markets
83.22
15.13
22.22%
WMK
Weis Markets
74.84
11.98
19.05%
SFM
Sprouts Farmers
48.00
-29.25
-37.86%
GO
Grocery Outlet Holding
12.88
-0.78
-5.71%
ACI
Albertsons Companies
12.79
-4.31
-25.21%
Kroger Company Corporate Events
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Kroger Announces Senior Notes Offering to Refinance Debt
Positive
Oct 5, 2026
On April 21, 2026, Kroger filed a shelf registration with the U.S. Securities and Exchange Commission, enabling the company to issue an indeterminate amount of securities over time. Under this framework, Kroger has arranged underwriting and pricin...
Business Operations and StrategyExecutive/Board Changes
Kroger appoints Mark Ibbotson to lead store operations
Positive
Sep 2, 2026
On August 31, 2026, Kroger appointed veteran retail executive Mark Ibbotson, 63, as Executive Vice President and Chief Store Operations Officer, with his role effective September 14, 2026. The decision was publicly announced in a September 2, 2026...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.