KROGER CO (KR) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:KR - US5010441013 - Common Stock
64.14 USD
+1.49 (+2.38%)
KR gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 38 industry peers in the Consumer Staples Distribution & Retail industry. KR has a medium profitability rating, but doesn't score so well on its financial health evaluation. KR has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- In the past year KR was profitable.
- KR had a positive operating cash flow in the past year.
- In the past 5 years KR has always been profitable.
- KR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- KR has a worse Return On Assets (1.50%) than 63.16% of its industry peers.
- The Return On Equity of KR (10.98%) is comparable to the rest of the industry.
- KR has a Return On Invested Capital (3.89%) which is in line with its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for KR is significantly below the industry average of 28.30%.
- The last Return On Invested Capital (3.89%) for KR is well below the 3 year average (8.58%), which needs to be investigated, but indicates that KR had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.5% | ||
| ROE | 10.98% | ||
| ROIC | 3.89% |
ROA(3y)4.59%
ROA(5y)4.47%
ROE(3y)24.18%
ROE(5y)23.32%
ROIC(3y)8.58%
ROIC(5y)8.18%
1.3 Margins
- KR has a worse Profit Margin (0.53%) than 60.53% of its industry peers.
- In the last couple of years the Profit Margin of KR has grown nicely.
- KR has a Operating Margin (1.12%) which is comparable to the rest of the industry.
- In the last couple of years the Operating Margin of KR has grown nicely.
- KR has a Gross Margin of 23.23%. This is comparable to the rest of the industry: KR outperforms 47.37% of its industry peers.
- In the last couple of years the Gross Margin of KR has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.12% | ||
| PM (TTM) | 0.53% | ||
| GM | 23.23% |
OM growth 3Y1.47%
OM growth 5Y6.25%
PM growth 3Y14.79%
PM growth 5Y6.04%
GM growth 3Y1.13%
GM growth 5Y0.63%
2. Health
2.1 Basic Checks
- KR has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- Compared to 1 year ago, KR has less shares outstanding
- KR has less shares outstanding than it did 5 years ago.
- KR has a worse debt/assets ratio than last year.
2.2 Solvency
- The Debt to FCF ratio of KR is 7.94, which is on the high side as it means it would take KR, 7.94 years of fcf income to pay off all of its debts.
- Looking at the Debt to FCF ratio, with a value of 7.94, KR is in line with its industry, outperforming 47.37% of the companies in the same industry.
- A Debt/Equity ratio of 2.28 is on the high side and indicates that KR has dependencies on debt financing.
- KR has a worse Debt to Equity ratio (2.28) than 84.21% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.28 | ||
| Debt/FCF | 7.94 | ||
| Altman-Z | N/A |
ROIC/WACC0.57
WACC6.88%
2.3 Liquidity
- KR has a Current Ratio of 0.88. This is a bad value and indicates that KR is not financially healthy enough and could expect problems in meeting its short term obligations.
- KR has a Current ratio of 0.88. This is amonst the worse of the industry: KR underperforms 81.58% of its industry peers.
- A Quick Ratio of 0.45 indicates that KR may have some problems paying its short term obligations.
- KR's Quick ratio of 0.45 is on the low side compared to the rest of the industry. KR is outperformed by 65.79% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.45 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 0.85% over the past year.
- The Earnings Per Share has been growing by 15.28% on average over the past years. This is quite good.
- Looking at the last year, KR shows a decrease in Revenue. The Revenue has decreased by -1.77% in the last year.
- KR shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.77% yearly.
EPS 1Y (TTM)0.85%
EPS 3Y6.78%
EPS 5Y15.28%
EPS Q2Q%7.14%
Revenue 1Y (TTM)-1.77%
Revenue growth 3Y2.18%
Revenue growth 5Y3.77%
Sales Q2Q%0.67%
3.2 Future
- KR is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.12% yearly.
- KR is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.24% yearly.
EPS Next Y10.34%
EPS Next 2Y10.48%
EPS Next 3Y8.99%
EPS Next 5Y7.12%
Revenue Next Year0.4%
Revenue Next 2Y1.25%
Revenue Next 3Y1.52%
Revenue Next 5Y2.24%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 13.59, the valuation of KR can be described as correct.
- 84.21% of the companies in the same industry are more expensive than KR, based on the Price/Earnings ratio.
- KR is valuated cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
- Based on the Price/Forward Earnings ratio of 11.73, the valuation of KR can be described as reasonable.
- 86.84% of the companies in the same industry are more expensive than KR, based on the Price/Forward Earnings ratio.
- KR's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 24.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.59 | ||
| Fwd PE | 11.73 |
4.2 Price Multiples
- KR's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. KR is cheaper than 63.16% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of KR indicates a somewhat cheap valuation: KR is cheaper than 65.79% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.73 | ||
| EV/EBITDA | 11.06 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.31
PEG (5Y)0.89
EPS Next 2Y10.48%
EPS Next 3Y8.99%
5. Dividend
5.1 Amount
- KR has a Yearly Dividend Yield of 2.24%.
- KR's Dividend Yield is rather good when compared to the industry average which is at 0.72. KR pays more dividend than 89.47% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, KR pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.24% |
5.2 History
- On average, the dividend of KR grows each year by 15.86%, which is quite nice.
- KR has been paying a dividend for at least 10 years, so it has a reliable track record.
- As KR did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)15.86%
Div Incr Years5
Div Non Decr Years5
5.3 Sustainability
- 115.27% of the earnings are spent on dividend by KR. This is not a sustainable payout ratio.
- KR's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP115.27%
EPS Next 2Y10.48%
EPS Next 3Y8.99%
KROGER CO / KR FAQ
What is the fundamental rating for KR stock?
ChartMill assigns a fundamental rating of 4 / 10 to KR.
What is the valuation status for KR stock?
ChartMill assigns a valuation rating of 6 / 10 to KROGER CO (KR). This can be considered as Fairly Valued.
What is the profitability of KR stock?
KROGER CO (KR) has a profitability rating of 5 / 10.
Can you provide the expected EPS growth for KR stock?
The Earnings per Share (EPS) of KROGER CO (KR) is expected to grow by 10.34% in the next year.
Is the dividend of KROGER CO sustainable?
The dividend rating of KROGER CO (KR) is 5 / 10 and the dividend payout ratio is 115.27%.