Oppenheimer Remains Confident in Kroger (KR) - Raises PT to $47

Oppenheimer reiterated an Outperform rating on Kroger (NYSE: KR), and raised the price target to $47.00 (from $42.00). Oppenheimer has identified KR as one of their top picks for several quarters. The raise in price target suggests an upside of about 12% from current levels. This compares with gains of 52% in 2013, 62% in 2014 and 30% in 2015 and performance in the S&P 500 of +30%, +11%, and (1%), respectively. As a frame of reference, KR outperformed the S&P 500 for four consecutive years later in the last economic cycle.

Analyst Rupesh Parikh commented, "For the past several quarters, we have identified KR as one of our top picks. In addition to our confidence in the company’s fundamental backdrop, two key components of our call have been the historical later cycle performance of the shares and the historical relationship of KR results/multiple to US employment. In 2015, KR shares again meaningfully outperformed the S&P 500 with a gain of 30% easily topping a 1% decline in the S&P 500. With the shares approaching our prior $42 PT, we completed a deep dive analysis revisiting our investment thesis and rating. Based on our work, we believe KR shares are well positioned for a fourth year of outperformance. We reiterate our Outperform rating and lift our PT to $47."

For an analyst ratings summary and ratings history on Kroger click here. For more ratings news on Kroger click here.

Shares of Kroger closed at $42.09 yesterday.

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