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Kroger (KR) Stock Sinks As Market Gains: What You Should Know

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Kroger (KR) closed at $39.96 in the latest trading session, marking a -0.92% move from the prior day. This move lagged the S&P 500's daily gain of 0.18%.

Heading into today, shares of the supermarket chain had gained 0.35% over the past month, lagging the Retail-Wholesale sector's gain of 1.13% and the S&P 500's gain of 2.96% in that time.

Investors will be hoping for strength from KR as it approaches its next earnings release. On that day, KR is projected to report earnings of $0.65 per share, which would represent a year-over-year decline of 8.45%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $30.87 billion, up 3.86% from the year-ago period.

KR's full-year Zacks Consensus Estimates are calling for earnings of $3.33 per share and revenue of $135.59 billion. These results would represent year-over-year changes of -4.03% and +2.33%, respectively.

It is also important to note the recent changes to analyst estimates for KR. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.01% higher. KR currently has a Zacks Rank of #1 (Strong Buy).

In terms of valuation, KR is currently trading at a Forward P/E ratio of 12.13. For comparison, its industry has an average Forward P/E of 12.47, which means KR is trading at a discount to the group.

Investors should also note that KR has a PEG ratio of 1.36 right now. 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 currently had an average PEG ratio of 1.36 as of yesterday's close.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 33, putting it in the top 13% of all 250+ industries.

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

You can find more information on all of these metrics, and much more, on Zacks.com.


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