Kroger Named Among Top 10 Value Dividend Stocks by Buffett
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 6 days ago
0mins
Source: Yahoo Finance
- Price Target Adjustment: JPMorgan has lowered Kroger's price target from $72 to $70 while maintaining a Neutral rating, anticipating the company will reaffirm its full-year guidance in the upcoming earnings report on June 18, indicating market confidence in its stability.
- Pricing Strategy Shift: New CEO Greg Foran plans to reduce prices on thousands of items to compete against rivals like Walmart, Costco, and Aldi, demonstrating Kroger's proactive approach in the market share battle.
- Cost-Cutting Initiatives: Kroger aims to support price reductions through tighter sourcing practices, streamlined operations, and cost-cutting measures, with plans to lower costs by directly importing goods and utilizing technology more effectively to enhance customer service.
- Market Positioning Adjustment: As a food and drug retailer, Kroger is working to attract consumers by lowering shelf prices, although analysts note that certain AI stocks may offer greater upside potential, reflecting Kroger's competitive standing in investors' minds.
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Analyst Views on KR
Wall Street analysts forecast KR stock price to rise
15 Analyst Rating
9 Buy
6 Hold
0 Sell
Moderate Buy
Current: 61.820
Low
68.00
Averages
75.00
High
85.00
Current: 61.820
Low
68.00
Averages
75.00
High
85.00
About KR
The Kroger Co. is a food and drug retailer. The Company operates supermarkets, multi-department stores and fulfillment centers throughout the United States. It operates approximately 2,697 supermarkets, 2,250 pharmacies and 1,731 fuel centers in over 35 states and the District of Columbia while also operating online through a digital ecosystem to offer customers an omnichannel shopping experience. The Company also manufactures and processes food for sale in its supermarkets and online. It offers Pickup and Harris Teeter ExpressLane personalized, order online, pick-up at the store services at approximately 2,408 of its supermarkets and provides delivery, which allows it to offer digital solutions to its customers. Its delivery solutions include orders delivered to customers at retail store locations, customer fulfillment centers and orders placed through third-party platforms. The Company also offers customer-facing apps and interfaces.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Kroger Q1 2026 Earnings Call Insights
- Rising Operating Costs: CEO Gregory Foran highlighted that Kroger's operating costs are growing faster than sales, posing sustainability challenges, and emphasized that cutting costs is essential to ensure future profitability.
- E-commerce Profitability: In Q1, Kroger's e-commerce business, including media, turned profitable for the first time, driving overall sales growth of 1%, indicating the company's adaptation to the rapidly changing retail landscape and its ability to seize market opportunities.
- Stable Financial Performance: Kroger reported an adjusted EPS of $1.58, slightly missing expectations, while adjusted FIFO operating profit reached $1.5 billion, demonstrating the company's efforts to maintain profitability amid challenging conditions.
- Optimistic Outlook: Despite facing transportation cost pressures and pharmacy sales headwinds, Kroger reaffirmed its full-year guidance, expecting Q2 sales to be in line with Q1, with growth accelerating in the second half, reflecting management's confidence in cost-saving initiatives.
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Kroger's Father's Day Promotions Enhance Family Celebrations
- Convenient Meal Options: Kroger introduces a variety of easy meal choices for Father's Day, including St. Louis-style ribs priced at $13.99 and 8-piece fried chicken for $8.99, aimed at helping families effortlessly prepare gatherings and enhancing customer satisfaction.
- Fuel Points Promotion: Customers can earn 4x fuel points on select gift card purchases, combined with a buy 2, save $3 card offer, further attracting customers and enhancing loyalty.
- Health Care Services: Kroger offers health screenings and vaccinations, helping families prioritize their father's wellness, reflecting the company's commitment to customer health and enhancing brand image.
- Diverse Beverage Selection: Kroger provides a wide range of beverages, including a buy 3, get 3 free offer on sodas and beers, catering to various customer needs, improving shopping experience, and driving sales growth.
See More
Kroger Supports Father's Day Celebrations with Easy Meals and Rewards
- Convenient Meal Options: Kroger offers a variety of easy meal options for Father's Day, including St. Louis-style ribs for $13.99 and 8-piece fried chicken for $8.99, aimed at helping families enjoy gatherings effortlessly, thereby enhancing customer satisfaction and driving sales.
- Fuel Points Promotion: Customers can earn 4x Fuel Points on select gift card purchases, along with a buy 2, save $3 card promotion, encouraging families to save while celebrating, which further strengthens customer loyalty.
- Health Care Services: Kroger provides health screenings and vaccinations, emphasizing the importance of prioritizing fathers' wellness, which enhances the company's commitment to customer well-being and strengthens brand image.
- Multi-Channel Shopping Convenience: Customers can shop conveniently through Kroger.com or via DoorDash and Uber Eats for quick delivery, ensuring a seamless shopping experience during Father's Day and expanding market reach.
See More
Kroger's Q1 Earnings Fall Short of Expectations
- Sales Growth: Kroger's adjusted sales increased by 0.5% year-over-year to $46 billion in Q1, falling short of investor expectations, indicating heightened competitive pressures in the supermarket sector.
- Same-Store Sales Performance: Excluding fuel, Kroger's same-store sales rose by 1%, but CEO Greg Foran emphasized the need to close the gap between the best-performing stores and the rest to enhance overall operational efficiency.
- Declining Gross Margin: Kroger's gross margin decreased from 23% to 22.7% year-over-year, primarily due to rising shipping costs and price reductions, which further compressed the company's operating profit.
- Stable Profit Outlook: Despite a less than 2% increase in adjusted operating profit to $1.5 billion in Q1, Kroger maintains its full-year adjusted operating profit forecast of approximately $5.1 billion, reflecting management's confidence in achieving financial targets.
See More
Kroger Faces Sales Slump as CEO Unveils Turnaround Plan
- Sales Growth Struggles: Kroger's adjusted sales for the fiscal first quarter rose only 0.5% year-over-year to $46 billion, with identical sales excluding fuel increasing by 1%, failing to meet investor expectations and resulting in a stock price decline.
- Declining Gross Margin: The company's gross margin fell to 22.7% from 23% in the prior year, primarily due to rising shipping costs and price reductions, further squeezing operating profits.
- Slight Profit Increase: Kroger's adjusted operating profit increased by less than 2% to $1.5 billion, while adjusted earnings per share rose 6% to $1.58, slightly below Wall Street's estimate of $1.59, indicating ongoing profitability challenges.
- Cost Control Strategy: CEO Greg Foran highlighted that operating costs are growing faster than sales, and he plans to reverse this trend by cutting costs, viewing it as essential for the company's future development.
See More
US Stocks Rise on US-Iran Peace Deal Optimism
- Market Rally: The S&P 500 rose 1.08%, the Dow Jones increased by 0.14%, and the Nasdaq 100 surged 2.48% as optimism over the US-Iran peace deal eased inflation risks, reflecting a positive market sentiment.
- Chip Sector Surge: Intel's stock jumped over 10% after President Trump announced a partnership with Apple to design and produce semiconductors domestically, leading the iShares Semiconductor ETF to rise more than 7%, indicating strong momentum in the tech sector.
- Energy Stocks Weaken: WTI crude oil prices fell to a 3.5-month low, causing significant declines in energy stocks, with SLB, ConocoPhillips, and Halliburton dropping over 3%, highlighting concerns over energy price volatility.
- Supportive Economic Data: Initial jobless claims fell to 226,000, close to the expected 225,000, indicating labor market strength, while the Philadelphia Fed business outlook index rose to 10.3, surpassing expectations, further boosting investor confidence.
See More
Kroger Q1 2026 Earnings Call Insights
- Rising Operating Costs: CEO Gregory Foran highlighted that Kroger's operating costs are growing faster than sales, posing sustainability challenges, and emphasized that cutting costs is essential to ensure future profitability.
- E-commerce Profitability: In Q1, Kroger's e-commerce business, including media, turned profitable for the first time, driving overall sales growth of 1%, indicating the company's adaptation to the rapidly changing retail landscape and its ability to seize market opportunities.
- Stable Financial Performance: Kroger reported an adjusted EPS of $1.58, slightly missing expectations, while adjusted FIFO operating profit reached $1.5 billion, demonstrating the company's efforts to maintain profitability amid challenging conditions.
- Optimistic Outlook: Despite facing transportation cost pressures and pharmacy sales headwinds, Kroger reaffirmed its full-year guidance, expecting Q2 sales to be in line with Q1, with growth accelerating in the second half, reflecting management's confidence in cost-saving initiatives.
See More
Kroger's Father's Day Promotions Enhance Family Celebrations
- Convenient Meal Options: Kroger introduces a variety of easy meal choices for Father's Day, including St. Louis-style ribs priced at $13.99 and 8-piece fried chicken for $8.99, aimed at helping families effortlessly prepare gatherings and enhancing customer satisfaction.
- Fuel Points Promotion: Customers can earn 4x fuel points on select gift card purchases, combined with a buy 2, save $3 card offer, further attracting customers and enhancing loyalty.
- Health Care Services: Kroger offers health screenings and vaccinations, helping families prioritize their father's wellness, reflecting the company's commitment to customer health and enhancing brand image.
- Diverse Beverage Selection: Kroger provides a wide range of beverages, including a buy 3, get 3 free offer on sodas and beers, catering to various customer needs, improving shopping experience, and driving sales growth.
See More
Kroger Supports Father's Day Celebrations with Easy Meals and Rewards
- Convenient Meal Options: Kroger offers a variety of easy meal options for Father's Day, including St. Louis-style ribs for $13.99 and 8-piece fried chicken for $8.99, aimed at helping families enjoy gatherings effortlessly, thereby enhancing customer satisfaction and driving sales.
- Fuel Points Promotion: Customers can earn 4x Fuel Points on select gift card purchases, along with a buy 2, save $3 card promotion, encouraging families to save while celebrating, which further strengthens customer loyalty.
- Health Care Services: Kroger provides health screenings and vaccinations, emphasizing the importance of prioritizing fathers' wellness, which enhances the company's commitment to customer well-being and strengthens brand image.
- Multi-Channel Shopping Convenience: Customers can shop conveniently through Kroger.com or via DoorDash and Uber Eats for quick delivery, ensuring a seamless shopping experience during Father's Day and expanding market reach.
See More
Kroger's Q1 Earnings Fall Short of Expectations
- Sales Growth: Kroger's adjusted sales increased by 0.5% year-over-year to $46 billion in Q1, falling short of investor expectations, indicating heightened competitive pressures in the supermarket sector.
- Same-Store Sales Performance: Excluding fuel, Kroger's same-store sales rose by 1%, but CEO Greg Foran emphasized the need to close the gap between the best-performing stores and the rest to enhance overall operational efficiency.
- Declining Gross Margin: Kroger's gross margin decreased from 23% to 22.7% year-over-year, primarily due to rising shipping costs and price reductions, which further compressed the company's operating profit.
- Stable Profit Outlook: Despite a less than 2% increase in adjusted operating profit to $1.5 billion in Q1, Kroger maintains its full-year adjusted operating profit forecast of approximately $5.1 billion, reflecting management's confidence in achieving financial targets.
See More
Kroger Faces Sales Slump as CEO Unveils Turnaround Plan
- Sales Growth Struggles: Kroger's adjusted sales for the fiscal first quarter rose only 0.5% year-over-year to $46 billion, with identical sales excluding fuel increasing by 1%, failing to meet investor expectations and resulting in a stock price decline.
- Declining Gross Margin: The company's gross margin fell to 22.7% from 23% in the prior year, primarily due to rising shipping costs and price reductions, further squeezing operating profits.
- Slight Profit Increase: Kroger's adjusted operating profit increased by less than 2% to $1.5 billion, while adjusted earnings per share rose 6% to $1.58, slightly below Wall Street's estimate of $1.59, indicating ongoing profitability challenges.
- Cost Control Strategy: CEO Greg Foran highlighted that operating costs are growing faster than sales, and he plans to reverse this trend by cutting costs, viewing it as essential for the company's future development.
See More
US Stocks Rise on US-Iran Peace Deal Optimism
- Market Rally: The S&P 500 rose 1.08%, the Dow Jones increased by 0.14%, and the Nasdaq 100 surged 2.48% as optimism over the US-Iran peace deal eased inflation risks, reflecting a positive market sentiment.
- Chip Sector Surge: Intel's stock jumped over 10% after President Trump announced a partnership with Apple to design and produce semiconductors domestically, leading the iShares Semiconductor ETF to rise more than 7%, indicating strong momentum in the tech sector.
- Energy Stocks Weaken: WTI crude oil prices fell to a 3.5-month low, causing significant declines in energy stocks, with SLB, ConocoPhillips, and Halliburton dropping over 3%, highlighting concerns over energy price volatility.
- Supportive Economic Data: Initial jobless claims fell to 226,000, close to the expected 225,000, indicating labor market strength, while the Philadelphia Fed business outlook index rose to 10.3, surpassing expectations, further boosting investor confidence.
See More
