UPDATE - UBS Initiates Coverage on Kroger (KR) with a Neutral; Executing Properly, But Shares Fairly Valued
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Price: $57.90 +2.81%
Rating Summary:
16 Buy, 19 Hold, 4 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
16 Buy, 19 Hold, 4 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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UPDATE - UBS initiates coverage on Kroger (NYSE: KR) with a Neutral rating. PT $25.
UBS analyst said, "Since the early 2000s, Kroger has continued to reduce its gross margin to drive market share gains. The strategy has worked very well, as its comparable sales growth has averaged 4% per year over the last 5 years, vs. Safeway (NYSE: SWY) at 0% and SUPERVALU (NYSE: SVU) at -3%. Despite the intentional reduction in gross margin, its comparable gross profit CAGR was 3%, allowing it to deliver 5% EPS CAGR in a very difficult period for conventional food retailers."
The analyst expects more of the same price commitments over the next five years and feels (as a bullish case) that KR has the opportunity to take growth to the next level (by rolliing out Fresh Fare and Food 4 Less to more markets).
To see more ratings on KR, Click Here
UBS analyst said, "Since the early 2000s, Kroger has continued to reduce its gross margin to drive market share gains. The strategy has worked very well, as its comparable sales growth has averaged 4% per year over the last 5 years, vs. Safeway (NYSE: SWY) at 0% and SUPERVALU (NYSE: SVU) at -3%. Despite the intentional reduction in gross margin, its comparable gross profit CAGR was 3%, allowing it to deliver 5% EPS CAGR in a very difficult period for conventional food retailers."
The analyst expects more of the same price commitments over the next five years and feels (as a bullish case) that KR has the opportunity to take growth to the next level (by rolliing out Fresh Fare and Food 4 Less to more markets).
To see more ratings on KR, Click Here
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