Market sentiments towards Kroger's stock: bullish or bearish?
Kroger Co. (KR), the leading American retail firm headquartered in Cincinnati, Ohio, has recently released its Q1 2025 results on June 20. The company reported an identical sales growth excluding fuel of 3.2%, with adjusted EPS coming in at $1.49.
Following this strong performance, Barclays initiated coverage on KR with an "Equalweight" rating and a $90 price target on July 21. This move suggests a potential upside potential of 25.4% based on the Barclays price target.
Kroger's stock has been on a significant upward trajectory in 2025, with a year-to-date (YTD) climb of 17.3% and a 33.1% increase over the past 52 weeks. The consensus rating, based on 11 "Strong Buy" and nine "Hold" ratings, indicates a positive outlook for the company.
The company's extensive network includes supermarkets, warehouse-style stores, fuel centers, pharmacies, in-store clinics, manufacturing plants, and jewelry outlets, making it one of the largest grocery retailers in the U.S. with a market capitalization of $47.4 billion.
Analysts expect Kroger to continue its strong performance, with adjusted EPS forecast to reach $4.76 for the current fiscal year (fiscal 2025 / year ending Jan. 2026), representing a 6.5% increase from fiscal 2024 levels. For the following fiscal year, estimates suggest adjusted EPS will rise to about $5.22, indicating a 9.7% year-over-year (YoY) growth.
Several factors have contributed to Kroger's outperformance in the supermarket/grocery industry. These include margin expansion, strong identical store sales, e-commerce growth, and strategic pricing decisions. Kroger's private-label brands such as Big K and Simple Truth also play a significant role in its success.
However, there are potential risks to watch, such as revenue softness versus expectations, leverage and balance-sheet metrics, and divergent price targets and coverage. As always, it's essential to conduct thorough research before making investment decisions.
For the latest real-time analyst count, price targets, and consensus numbers, or a short sensitivity table showing how KR’s valuation and upside change under alternative EPS and multiple assumptions, feel free to ask!
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This article does not mention any positions held by Sristi Jayaswal in the securities mentioned.
In light of Kroger Co.'s robust Q1 2025 results and positive outlook, various analysts are recommending investing in KR as a promising business venture, considering the potential upside of 25.4% based on Barclays' price target. The continuous growth of Kroger, notably its Year-to-Date climb of 17.3% and a 33.1% increase over the past 52 weeks, reflects well on its performance in the stock-market.
