Albertsons: Potential 33% Share Price Return, Still A Buy At Current Price

Nov. 21, 2022 1:13 AM ETAlbertsons Companies, Inc. (ACI)KR23 Comments
Yannick Frey profile picture
Yannick Frey
1.03K Followers

Summary

  • Kroger's acquisition of Albertsons will result in strong synergies and cost savings; it will also provide a better distribution of geographic sales.
  • The combined company will become the third-largest food and drugstore in the United States.
  • Investors are skeptical about the approval of the acquisition and distribution of the special dividend.
  • The current stock price allows an expected return of 33%. Investors will also receive shares in the company that includes 100 to 375 Albertsons food and drug stores.
  • The stock is worth buying because of its favorable risk/reward ratio.

Top Grocery Retailer Kroger To Acquire Rival Albertsons For $24.6 Billion

Mario Tama

Introduction

Albertsons (NYSE:ACI) is expected to be acquired by Kroger (KR). After the merger, the company will become the third largest food and drugstore in the United States. The terms of the acquisition include the distribution of

Sales of the leading food and grocery retailers in the United States in 2021 (in billion U.S. dollars)* - Statista

Sales of the leading food and grocery retailers in the United States in 2021 (in billion U.S. dollars)* (Statista)

Chart
Data by YCharts

Earnings estimates for Albertsons - ACI Seeking Alpha Ticker Page

Earnings estimates for Albertsons (ACI Seeking Alpha Ticker Page)

This article was written by

Yannick Frey profile picture
1.03K Followers
Yannick is a passionate investor from the Netherlands who shares his analyses with other investors on Seeking Alpha. In doing so, he looks for companies with the following characteristics:1. Companies that are growing in both revenue, earnings and free cash flow.2. Companies that have excellent growth prospects.3. Stocks with favorable valuations.He prefers steadily growing companies with high free cash flow margins, dividend stocks and stocks with generous share repurchase programs.Disclaimer: My articles do not provide financial advice, they reflect my own findings and insights.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in ACI over 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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