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Kroger Is Expected To See A Big Jump In Earnings For Fiscal Q1

Jun. 14, 2020 4:02 AM ETThe Kroger Co. (KR)7 Comments
Rick Pendergraft profile picture
Rick Pendergraft


  • Kroger is set to report earnings on Thursday and analysts are expecting an increase of 44% compared to Q1 2019.
  • The stock has been trending higher with a trend channel forming that helps define the trend.
  • Sentiment toward the stock is skewed to the bearish side.
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One area of the economy that has seemingly benefited from the global health crisis has been grocery stores. With so many people staying home and cooking for themselves with restaurants closed, grocery stores have seen a boost in sales. The industry hasn’t fully escaped the pandemic though as they have had to take extra measures to make sure the customers are safe. The industry has had to increase cleaning measures and in many cases stores have had to add employees. These steps have added costs and likely cut in to the margins for stores. Some stores also increased the pay of employees to compensate for the uncertainty surrounding the conditions they were being exposed to.

One of the largest publicly traded grocery store chains is Kroger (NYSE:KR) and the company is set to report earnings on Thursday. Analysts expect the company to earn $1.04 per share for the fiscal first quarter of 2020. The company earned $0.72 in the first quarter of 2019 and that would mean an increase of 44.4% if the estimate is accurate.

Over the last three years Kroger has averaged earnings growth of only 3% per year, but it did see a jump of 19% in the fourth quarter of 2019. Analysts expect earnings to grow by 21% for the year.

Revenue is expected to come in at $40.45 billion for the quarter and that is an increase of 8.6% over last year. Revenue has been growing at a rate of 2% per year over the last three years and it grew by 2% in the fourth quarter.

The company’s management efficiency measurements are mixed. The return on equity is above average at 21.7%, but the profit margin is below average at 1.8%. The stock is currently trading with a trailing P/E ratio of 15.9 and a forward P/E

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This article was written by

Rick Pendergraft profile picture
Rick Pendergraft is a Senior Editor on the Opinion & Analysis team at Seeking Alpha. Prior to joining Seeking Alpha, he studied, traded, analyzed, and wrote about the investment markets for over 30 years. He has worked for some of the largest financial publishers in the world and he has been quoted in the Wall Street Journal, USA Today, the New York Times and the Washington Post. In addition, he has been interviewed on Bloomberg, CNBC and Fox Business News. After starting college as an education major, wanting to teach economics, Rick eventually changed to majoring in Economics and received a Bachelor of Science in Economics from Wright State University. His desire to inform and educate people is at the heart of his writing.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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