Kroger (KR) Stock: Gaining On Strong Earnings

Kroger Co (NYSE: KR) is having an incredibly strong start to the trading session this morning in the pre-market hours, and for good reason. The company reported its earnings for the third quarter, blowing away expectations and leading to excitement among investors. Today, we’ll talk about what we saw from earnings, how the stock reacted to the news, and what we’ll be watching with regard to KR ahead.

KR Reports Strong Earnings

As mentioned above, Kroger is having an incredibly strong start to the trading session this morning after the company reported better-than-expected earnings for the third quarter. Here’s what we saw from the report:

  • Net Income – In terms of net income, KR did very well. During the quarter, analysts expected that earnings would come in at $0.40 per share. However, net income came in at $397 million, bringing earnings to $0.44 per share and beating expectations.
  • Revenue – Revenue also proved to be a strong point for KR during this earnings report. During the quarter, analysts expected revenue to come in at $27.484 billion. However, the company actually reported revenue in the amount of $27.749 billion.
  • Guidance – Finally, guidance for the full year proved to be positive. Throughout the year, the company is expecting earnings per share to come in between $2.00 and $2.05 per share. At the moment, analysts are expecting full-year earnings to come in at $1.97 per share.

In a statement, Rodney McMullen, CEO at Kroger, had the following to offer:

Restock Kroger is off to a great stock. Customers are recognizing our efforts to redefine the customer experience and rewarding us with their loyalty. We continue to accelerate our digital and ecommerce offerings, to grow Our Brands, to lower prices for customers, and to invest in our associates.

The holidays are always Kroger’s time to shine. In fact, we had our best ever Black Friday results for general merchandise, led by record sales at Fred Meyer. Everything we are doing revolves around our associates providing friendly service and fresh products to our customers.

This quarter shows that by investing for the future, our business continues to improve and gain momentum. We remain confident in our ability to continue to grow identical supermarket store sales and market share for the balance of the year and in 2018.”

How The Stock Reacted To The News

One of the first things that we learn as investors is that the news moves the market. That’s especially the case when we’re talking about earnings news. With strong Q3 earnings, KR is making a run for the top. Of course, our partners at Trade Ideas were the first to alert us to the gains. At the moment (9:00), KR is trading at $27.00 per share after a gain of $2.62 per share (10.75%) thus far today.

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What We’ll Be Watching For Ahead

Moving forward, the CNA Finance team will continue to keep a close eye on KR. In particular, we’re interested in following the company’s Restock Kroger initiative and their work toward continued growth at Fred Meyer. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!

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