Kroger shares jump 10% on strong results

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Shares jumped 7.5% to $26.28 during premarket trading Thursday as the earnings might help quell concerns that Kroger has lost market share to rivals.

Kroger investors seem to be on board with the plan, with the company's stock surging 12.9% after the announcement. Including fuel, comparable sales grew 2.4% as gasoline prices reached a two-year high during the most recent quarter. Vanguard Group Inc. increased its holdings in Kroger by 1.2% in the 2nd quarter.

A number of research firms recently issued reports on KR.

Bank of New York Mellon Corp increased its position in Kroger Co (NYSE:KR) by 0.3% during the 3rd quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). (NYSE:KR) shares passing the 70 level, the stock is now considered to be in overbought territory and ripe for a potential pullback. The company has a current ratio of 0.87, a quick ratio of 0.33 and a debt-to-equity ratio of 2.13. The firm owned 6,715,387 shares of the company's stock after acquiring an additional 18,468 shares during the quarter. Kroger Co has a 1-year low of $28.29 and a 1-year high of $37.97.

Kroger (NYSE:KR) last announced its quarterly earnings results on Thursday, November 30th. The FactSet consensus is for 2017 EPS of $1.97.

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The results represent a mini-rebound for the company, which has seen profits suffer as it slashed prices to compete with Walmart and Target - as well as Amazon since its acquisition of Whole Foods - in an increasingly competitive landscape for grocers. Oppenheimer Holdings, Inc. cut Kroger Company (The) to a "market perform" rating and cut their target price for the stock from $28.00 to $23.00 in a research note on Friday, September 8th. 24,795,048 shares of the company were exchanged, compared to its average volume of 12,086,863.

Highlights from the report include a 30 basis point improvement in gross margins to 22.4%, along with the increase in digital revenue from Kroger's ClickList service. The firm had revenue of $27.75 billion for the quarter, compared to analysts' expectations of $27.48 billion.

In addition, the company told investors to expect full year earnings of up to $2.05 per share this year. One analyst has rated the stock with a sell rating, eleven have issued a hold rating and twelve have assigned a buy rating to the company. The business's revenue for the quarter was up 4.5% compared to the same quarter a year ago.

The firm also recently disclosed a quarterly dividend, which will be paid on Friday, December 1st. Stockholders of record on Monday, May 15th will be given a dividend of $0.12 per share. The ex-dividend date of this dividend is Tuesday, November 14th. Kroger's payout ratio is 23.08%. The company presently has a consensus rating of "Hold" and an average target price of $29.44.

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