August 1, 2018

KR – Market expectations are for Uniform ROA to recover to near cost-of-capital levels, and management is confident in their Restock Kroger initiative and price investments


  • The Kroger Co. (KR:USA)currently trades at historical lows relative to UAFRS-based (Uniform) Assets, with an 18.6x Uniform P/E. However, even at these levels, markets are pricing in somewhat optimistic expectations for the firm. Moreover, management is confident in the progression of their Restock Kroger initiative and the impact of recent price investments
  • Specifically, management generated an excitement marker when talking about recent investments in their business, and are confident about the impact of their price investments on price elasticity. They are also confident in their Restock Kroger initiative, their current retail fuel performance, and lower debt-to-EBITA ratios compared to last years’.

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