Kroger Company (KR)
NYSE:KR
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Kroger Company
(NYSE:KR)
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Rating:60Neutral
Price Target:
$72.00
▲(9.06% Upside)
Action:Reiterated
Date:05/21/26
The score is primarily held back by weakened recent profitability and high leverage despite strong cash generation. Valuation is a relative positive (low P/E and dividend yield), while the latest earnings call points to steady operations and strategic progress but with meaningful 2026 headwinds and lower free cash flow guidance. Technical indicators are mixed and do not add strong momentum support.
Positive Factors
Cash generation
Sustained operating cash flow and a meaningful free cash flow ramp provide durable internal funding for capex, share repurchases, and strategic investments (e‑commerce, media). Reliable FCF cushions the business against cyclical retail pressures and supports execution of multi-year initiatives.
Negative Factors
High leverage
Elevated leverage materially reduces financial flexibility and raises refinancing and covenant risk if margins remain pressured. High debt limits ability to fund opportunistic investments or absorb shocks, making multi‑year strategic execution and capital returns more contingent on sustained cash generation.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Sustained operating cash flow and a meaningful free cash flow ramp provide durable internal funding for capex, share repurchases, and strategic investments (e‑commerce, media). Reliable FCF cushions the business against cyclical retail pressures and supports execution of multi-year initiatives.
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
$37.96B
Dividend Yield2.15%
Average Volume (3M)5.59M
Price to Earnings (P/E)37.9
Beta (1Y)-0.17
Revenue Growth0.35%
EPS Growth-57.81%
CountryUS
Employees409,000
SectorConsumer Defensive
Sector Strength42
IndustryGrocery Stores
Share Statistics
EPS (TTM)1.57
Shares Outstanding616,560,670
10 Day Avg. Volume7,409,433
30 Day Avg. Volume5,592,327
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 Cap1.57
Enterprise Value/Revenue0.40
Enterprise Value/Gross Profit1.73
Enterprise Value/Ebitda10.36
Forecast
1Y Price Target
$76.15Price Target Upside15.35% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
EPS Forecast (FY)5.24
Revenue Forecast (FY)$149.61B
Kroger Company Business Overview & Revenue Model
Company Description
The Kroger Co. operates as a retailer in the United States. The company operates combination food and drug stores, multi-department stores, marketplace stores, and price impact warehouses. Its combination food and drug stores offer natural food an...
How the Company Makes Money
Kroger primarily makes money by selling groceries and everyday consumer products to retail customers through its stores and digital platforms, generating the majority of revenue from food and consumables (including fresh and center-store items) an...
Kroger Company Earnings Call Summary
Earnings Call Date:Mar 05, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Jun 18, 2026
Earnings Call Sentiment Positive
The call presented multiple strong operational and financial highlights — including solid same-store sales, double-digit e-commerce growth, EPS growth, margin improvements, strong free cash flow generation, and active capital return — while acknowledging several industry and company-specific headwinds such as IRA impacts on pharmacy reimbursement, continued soft unit volumes, egg deflation near-term effects, a larger LIFO charge, and lower free cash flow guidance for 2026. Management emphasized ongoing cost savings, AI and e-commerce initiatives, a focused capital allocation plan and expectations for margin improvement and e-commerce profitability in 2026, indicating constructive momentum despite near-term pressures.Positive Updates
Same-Store Sales Growth
Identical sales excluding fuel grew 2.4% in Q4 (including ~40 basis point headwind from the Inflation Reduction Act) and 2.9% for the full fiscal year 2025, in line with guidance.
Negative Updates
Inflation Reduction Act Headwinds
IRA reduced Q4 identical sales ex-fuel by nearly 40 basis points and is expected to create an approximate 130 basis point headwind to identical sales ex-fuel in 2026 (impacting pharmacy reimbursement and reported comp metrics).
Read all updates
Q4-2025 Updates
Positive
Negative
Same-Store Sales Growth
Identical sales excluding fuel grew 2.4% in Q4 (including ~40 basis point headwind from the Inflation Reduction Act) and 2.9% for the full fiscal year 2025, in line with guidance.
Read all positive updates
Company Guidance
Kroger guided 2026 identical sales excluding fuel of 1.0%–2.0% (or 2.3%–3.3% excluding an ~130‑bp headwind from the Inflation Reduction Act), with Q1 expected near the low end due to egg deflation; total sales ex‑fuel should be slightly below comps reflecting ≈$350M headwind from a Florida fulfillment‑center closure and ≈$300M headwind from the Vitacost sale. They expect adjusted FIFO operating profit of $5.0B–$5.2B, adjusted free cash flow of $2.7B–$2.9B, adjusted net EPS of $5.10–$5.30, CapEx of $3.8B–$4.0B, and a LIFO charge similar to 2025 (≈$157M, ~+$0.07 EPS headwind last year); fuel gallons and fuel profits are expected to be slightly down. Management said e‑commerce should accelerate and be profitable in 2026 (with convenience delivery via Instacart/DoorDash/Uber Eats contributing to >$1.5B in sales), Media should deliver double‑digit growth, cost‑savings will exceed 2025 driven by e‑commerce and procurement, new store openings are planned to increase ~30% (including entry into two new regions), and modest benefits from the Kroger Global Capability Center will begin in 2026 with larger gains in 2027–28.Kroger Company Financial Statement Overview
Summary
Income Statement
58
Neutral
Balance Sheet
42
Neutral
Cash Flow
74
Positive
| Breakdown | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 147.64B | 147.12B | 150.04B | 148.26B | 137.89B |
| Gross Profit | 34.40B | 33.40B | 33.36B | 31.78B | 30.35B |
| EBITDA | 5.76B | 7.64B | 7.03B | 7.02B | 6.05B |
| Net Income | 1.02B | 2.67B | 2.16B | 2.24B | 1.66B |
Balance Sheet | |||||
| Total Assets | 49.94B | 52.62B | 50.51B | 49.62B | 49.09B |
| Cash, Cash Equivalents and Short-Term Investments | 4.58B | 5.27B | 3.10B | 2.14B | 2.90B |
| Total Debt | 24.68B | 25.08B | 19.25B | 20.41B | 20.44B |
| Total Liabilities | 44.01B | 44.34B | 38.90B | 39.61B | 39.66B |
| Stockholders Equity | 5.93B | 8.29B | 11.62B | 10.04B | 9.45B |
Cash Flow | |||||
| Free Cash Flow | 3.35B | 1.78B | 2.88B | 1.23B | 3.58B |
| Operating Cash Flow | 7.21B | 5.79B | 6.79B | 4.31B | 6.19B |
| Investing Cash Flow | -3.91B | -3.23B | -3.75B | -3.02B | -2.61B |
| Financing Cash Flow | -3.98B | -490.00M | -2.17B | -2.29B | -3.44B |
Kroger Company Technical Analysis
Negative
66.02
Price Trends
67.50
Negative
67.37
Negative
66.19
Negative
Market Momentum
-1.51
Positive
32.90
Neutral
2.34
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KR, the sentiment is Negative. The current price of 66.02 is above the 20-day moving average (MA) of 65.27, below the 50-day MA of 67.50, and below the 200-day MA of 66.19, indicating a bearish trend. The MACD of -1.51 indicates Positive momentum. The RSI at 32.90 is Neutral, neither overbought nor oversold. The STOCH value of 2.34 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KR.
Kroger Company Risk Analysis
Kroger Company disclosed 15 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 |
|---|---|---|---|---|---|---|---|
72 Outperform | $7.34B | 14.76 | 36.06% | ― | 10.25% | 17.03% | |
67 Neutral | $1.84B | 18.08 | 7.49% | 2.06% | 4.14% | -0.27% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
60 Neutral | $37.96B | 37.91 | 13.04% | 2.15% | 0.35% | -57.81% | |
56 Neutral | $1.65B | 15.91 | 6.41% | 0.93% | -0.28% | 68.37% | |
51 Neutral | $7.71B | 36.83 | 8.17% | 3.49% | 3.46% | -80.55% | |
49 Neutral | $837.88M | -2.13 | -36.58% | ― | 6.04% | -2370.84% |
* Consumer Defensive Sector Average
KR
Kroger Company
62.24
-2.65
-4.08%
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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.