Kroger Co. (NYSE: KR) reported its fiscal first-quarter financial results before the markets opened on Thursday. The grocery chain operator said that it had $1.22 in earnings per share (EPS) and $41.5 billion in revenue, which compares with consensus estimates of $1.09 in EPS and revenue of $40.72 billion. The same period of last year reportedly had EPS of $0.72 and $37.25 billion in revenue.
During the most recent quarter, identical sales without fuel grew 19.0% year over year and digital sales grew 92%.
The company issued no new guidance for the 2020 fiscal full year, citing uncertainty surrounding the coronavirus. However, the company did note that it expects same-store sales to be higher for the year than initially anticipated. Consensus estimates call for $2.68 in EPS and $127.04 billion in revenue for the year.
Kroger’s capital allocation strategy is to use its adjusted free cash flow to invest in the business and drive profitable growth while also maintaining its current investment grade debt rating and returning capital to shareholders. Accordingly, the company’s net total debt to adjusted EBITDA ratio is 1.81, compared to 2.54 a year ago. The company’s net total debt to adjusted EBITDA ratio target range is 2.30 to 2.50.
On the books, cash and temporary cash investments totaled $2.73 billion at the end of the quarter, up from $409 million in the same period of last year.
Rodney McMullen, board chair and chief executive, pointed out success from the current Restock Kroger program, which has expanded the chain’s digital ecosystem, and the Our Brands program, which has enhanced product quality. He also noted that these investments have helped Kroger further deliver improved results, especially with this quarter.
Kroger stock traded down about 2% at $32.18 on Thursday, in a 52-week range of $20.70 to $36.84. The consensus price target is $35.01.
24/7 Wall St.Get Ready To Retire (Sponsored)
Start by taking a quick retirement quiz from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes, or less.
Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.
Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future
Get started right here.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
Our expert who first called NVIDIA in 2009 is predicting 2025 will see a historic AI breakthrough.
You can follow him investing $500,000 of his own money on our top AI stocks for free.