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Kroger (KR) Stock Drops Despite Market Gains: Important Facts to Note

The latest trading session saw Kroger (KR) ending at $51.37, denoting a -0.52% adjustment from its last day's close. The stock's performance was behind the S&P 500's daily gain of 0.27%. At the same time, the Dow lost 0.31%, and the tech-heavy Nasdaq gained 0.88%.

The supermarket chain's shares have seen a decrease of 6.45% over the last month, not keeping up with the Retail-Wholesale sector's gain of 0.48% and the S&P 500's gain of 2.85%.

The investment community will be closely monitoring the performance of Kroger in its forthcoming earnings report. The company is scheduled to release its earnings on June 20, 2024. The company is expected to report EPS of $1.33, down 11.92% from the prior-year quarter. In the meantime, our current consensus estimate forecasts the revenue to be $45.02 billion, indicating a 0.31% decline compared to the corresponding quarter of the prior year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $4.43 per share and a revenue of $148.12 billion, representing changes of -6.93% and -1.28%, respectively, from the prior year.

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Investors might also notice recent changes to analyst estimates for Kroger. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.01% lower. Kroger is currently a Zacks Rank #3 (Hold).

Looking at valuation, Kroger is presently trading at a Forward P/E ratio of 11.65. This denotes a discount relative to the industry's average Forward P/E of 12.2.

Also, we should mention that KR has a PEG ratio of 1.95. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Retail - Supermarkets industry had an average PEG ratio of 1.93 as trading concluded yesterday.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. With its current Zacks Industry Rank of 24, this industry ranks in the top 10% of all industries, numbering over 250.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.

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