KROGER CO (KR) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:KR - US5010441013 - Common Stock
62.11 USD
-1.58 (-2.48%)
61.995 USD
-0.12 (-0.19%)
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 on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
- KR had positive earnings in the past year.
- In the past year KR had a positive cash flow from operations.
- KR had positive earnings in each of the past 5 years.
- In the past 5 years KR always reported a positive cash flow from operatings.
1.2 Ratios
- KR has a worse Return On Assets (1.50%) than 63.16% of its industry peers.
- KR's Return On Equity of 10.98% is in line compared to the rest of the industry. KR outperforms 50.00% of its industry peers.
- 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
- With a Profit Margin value of 0.53%, KR is not doing good in the industry: 60.53% of the companies in the same industry are doing better.
- 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.
- KR's Operating Margin has improved in the last couple of years.
- 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.
- KR has less shares outstanding than it did 1 year ago.
- The number of shares outstanding for KR has been reduced compared to 5 years ago.
- The debt/assets ratio for KR is higher compared to a year ago.
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.
- KR's Debt to FCF ratio of 7.94 is in line compared to the rest of the industry. KR outperforms 47.37% of its industry peers.
- KR has a Debt/Equity ratio of 2.28. This is a high value indicating a heavy dependency on external financing.
- Looking at the Debt to Equity ratio, with a value of 2.28, KR is doing worse than 84.21% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.28 | ||
| Debt/FCF | 7.94 | ||
| Altman-Z | N/A |
ROIC/WACC0.57
WACC6.84%
2.3 Liquidity
- A Current Ratio of 0.88 indicates that KR may have some problems paying 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.
- With a Quick ratio value of 0.45, KR is not doing good in the industry: 65.79% of the companies in the same industry are doing better.
| 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.
- The Revenue has decreased by -1.77% in the past year.
- Measured over the past years, KR shows a small growth in Revenue. The Revenue has been growing by 3.77% on average per year.
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
- The Earnings Per Share is expected to grow by 7.12% on average over the next years.
- 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
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- 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
- A Price/Earnings ratio of 13.16 indicates a correct valuation of KR.
- 81.58% of the companies in the same industry are more expensive than KR, based on the Price/Earnings ratio.
- When comparing the Price/Earnings ratio of KR to the average of the S&P500 Index (28.87), we can say KR is valued rather cheaply.
- The Price/Forward Earnings ratio is 11.36, which indicates a very decent valuation of KR.
- Based on the Price/Forward Earnings ratio, KR is valued cheaper than 84.21% of the companies in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.96. KR is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.16 | ||
| Fwd PE | 11.36 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as KR.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of KR indicates a somewhat cheap valuation: KR is cheaper than 60.53% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.14 | ||
| EV/EBITDA | 11.2 |
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)1.27
PEG (5Y)0.86
EPS Next 2Y10.48%
EPS Next 3Y8.99%
5. Dividend
5.1 Amount
- KR has a Yearly Dividend Yield of 2.23%.
- Compared to an average industry Dividend Yield of 0.73, KR pays a better dividend. On top of this KR pays more dividend than 86.84% of the companies listed 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 | 2.23% |
5.2 History
- The dividend of KR is nicely growing with an annual growth rate of 15.86%!
- KR has been paying a dividend for at least 10 years, so it has a reliable track record.
- KR has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
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.
- The dividend of KR is growing, but the earnings are growing slower. 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%.