Kroger Co

KR

Retail-Grocery Stores

Mkt Cap

$37.54B

PE

17.49

Debt

$10.21B

Cash

$1.883B

EV

$45.87B

FCF

$2.884B

Market Cap

$37.54B

P/E Ratio

17.49

Debt

$10.21B

Cash

$1.883B

EV

$45.87B

FCF

$2.884B

Charts data: {"Earnings":[{"time":"2015-01-30","value":1728000000},{"time":"2016-01-29","value":2021000000},{"time":"2017-01-27","value":1957000000},{"time":"2018-02-02","value":1889000000},{"time":"2019-02-01","value":3076000000},{"time":"2020-01-31","value":1512000000},{"time":"2021-01-29","value":2556000000},{"time":"2022-01-28","value":1639000000},{"time":"2023-01-27","value":2224000000},{"time":"2024-02-02","value":2146000000}],"Sales":[{"time":"2015-01-30","value":108465000000},{"time":"2016-01-29","value":109830000000},{"time":"2017-01-27","value":115337000000},{"time":"2018-02-02","value":122662000000},{"time":"2019-02-01","value":121162000000},{"time":"2020-01-31","value":122286000000},{"time":"2021-01-29","value":132498000000},{"time":"2022-01-28","value":137888000000},{"time":"2023-01-27","value":148258000000},{"time":"2024-02-02","value":150039000000}],"Net Margins":[{"time":"2015-01-30","value":0.015931406444475178},{"time":"2016-01-29","value":0.01840116543749431},{"time":"2017-01-27","value":0.016967668657932842},{"time":"2018-02-02","value":0.015400042392917122},{"time":"2019-02-01","value":0.025387497730311483},{"time":"2020-01-31","value":0.012364457092389971},{"time":"2021-01-29","value":0.019290857220486346},{"time":"2022-01-28","value":0.011886458575075424},{"time":"2023-01-27","value":0.015000876849815862},{"time":"2024-02-02","value":0.014302947900212611}],"Assets":[{"time":"2015-01-30","value":30556000000},{"time":"2016-01-29","value":33897000000},{"time":"2017-01-27","value":36505000000},{"time":"2018-02-02","value":37197000000},{"time":"2019-02-01","value":38118000000},{"time":"2020-01-31","value":45256000000},{"time":"2021-01-29","value":48662000000},{"time":"2022-01-28","value":49086000000},{"time":"2023-01-27","value":49623000000},{"time":"2024-02-02","value":50505000000}],"Stockholders Equity":[{"time":"2015-01-30","value":5442000000},{"time":"2016-01-29","value":6820000000},{"time":"2017-01-27","value":6710000000},{"time":"2018-02-02","value":6931000000},{"time":"2019-02-01","value":7886000000},{"time":"2020-01-31","value":8602000000},{"time":"2021-01-29","value":9576000000},{"time":"2022-01-28","value":9452000000},{"time":"2023-01-27","value":10042000000},{"time":"2024-02-02","value":11615000000}],"ROE":[{"time":"2015-01-30","value":0.3175303197353914},{"time":"2016-01-29","value":0.2963343108504399},{"time":"2017-01-27","value":0.29165424739195234},{"time":"2018-02-02","value":0.27254364449574375},{"time":"2019-02-01","value":0.3900583312198833},{"time":"2020-01-31","value":0.1757730760288305},{"time":"2021-01-29","value":0.2669172932330827},{"time":"2022-01-28","value":0.17340245450698266},{"time":"2023-01-27","value":0.22146982672774349},{"time":"2024-02-02","value":0.18476108480413259}],"ROA":[{"time":"2015-01-30","value":0.1026639612514727},{"time":"2016-01-29","value":0.10549606159837153},{"time":"2017-01-27","value":0.09412409259005616},{"time":"2018-02-02","value":0.05605290749253972},{"time":"2019-02-01","value":0.1206254263077811},{"time":"2020-01-31","value":0.05709740144953156},{"time":"2021-01-29","value":0.08043237022728207},{"time":"2022-01-28","value":0.07083486126390416},{"time":"2023-01-27","value":0.08314692783588255},{"time":"2024-02-02","value":0.0613008613008613}]}

The Kroger Co. operates as a food and drug retailer in the United States. The company operates combination food and drug stores, multi-department stores, marketplace stores, and price impact warehouses. Its combination food and drug stores offer natural food and organic sections, pharmacies, general merchandise, pet centers, fresh seafood, and organic produce; and multi-department stores provide apparel, home fashion and furnishings, outdoor living, electronics, automotive products, and toys. The company's marketplace stores offer full-service grocery, pharmacy, health and beauty care, and perishable goods, as well as general merchandise, including apparel, home goods, and toys; and price impact warehouse stores provide grocery, and health and beauty care items, as well as meat, dairy, baked goods, and fresh produce items. It also manufactures and processes food products for sale in its supermarkets and online; and sells fuel through fuel centers. The Kroger Co. was founded in 1883 and is based in Cincinnati, Ohio.

Sector

10-Q
8/12/23
10-Q
5/20/23
10-K
1/28/23
10-Q
11/5/22
10-Q
8/13/22
10-Q
5/21/22
10-K
1/29/22
10-Q
11/6/21
10-Q
8/14/21
10-Q
5/22/21
10-K
1/30/21
10-Q
11/7/20
10-Q
8/15/20
10-Q
5/23/20
10-K
2/1/20
10-Q
11/9/19
10-Q
8/17/19
10-Q
5/25/19
10-K
2/2/19
10-Q
11/10/18
10-Q
8/18/18
10-Q
5/26/18
10-K
2/3/18

DCF

Discounted Cash Flow Valuation of Kroger Co

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

Multiple

g\r	+10%	+11%	+12%	+13%	+14%
0%	10	9	8	8	7
+1%	11	10	9	8	8
+2%	13	11	10	9	8
+3%	14	13	11	10	9
+4%	17	14	12	11	10

Years	0	1	2	3	4	5	6	7	8	9	10	TV
FCF	$2.884B	$3.342B	$3.833B	$4.349B	$4.882B	$5.421B	$5.954B	$6.468B	$6.948B	$7.379B	$7.748B	$77.48B
DCF		$2.906B	$2.898B	$2.859B	$2.791B	$2.695B	$2.574B	$2.432B	$2.271B	$2.098B	$1.915B	$19.15B
Value	$44.59B

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth -0.72%

Earnings Stability 0.38%

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

The Net Margin is too low to guarantee profitability in case of higher costs or higher interest rates. Furthermore lower margins cause higher earnings’ volatility.

Over time the ROA has been decreasing indicating a lower marginal ROA with respect to the calculated one, this could impede growth.

Years	01-2016	01-2017	02-2018	02-2019	01-2020	01-2021	01-2022	01-2023	02-2024	TTM
Net Margin	1.8%	1.7%	1.5%	2.5%	1.2%	1.9%	1.2%	1.5%	1.4%	1.4%
ROA	11%	9.4%	5.6%	12%	5.7%	8%	7.1%	8.3%	6.1%	6.1%
ROE	30%	29%	27%	39%	18%	27%	17%	22%	18%	18%

What is the average Net Margin?

The average Net Margin over the past 5 years is +1.64%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is -0.16%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +7.89%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is -0.65%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is +23.54%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is -2.81%.

Safety & Stabiliy

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

Under the assumption that FCF does not diminish and debt does not increase, the current years to repay the debt are acceptable.

The Graham’s stability indicate a relevant drawdown, consider checking when it has occured and why.

Years	01-2016	01-2017	02-2018	02-2019	01-2020	01-2021	01-2022	01-2023	02-2024	TTM
Debt FCF	8.78	27.17	30.38	14.63	9.88	3.36	3.41	8.76	3.54	3.54
Debt Equity	2.02	2.32	2.65	2.22	1.76	1.38	1.29	1.24	0.88	0.88
MIN
Graham Stability	-	-	99%	100%	66%	100%	69%	100%	100%	66%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 3.54.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is -1.68.

What is the Graham’s Stability?

Graham’s Stability measure stands at 0.66.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Earnings growth has not been increasing in the past years.

Years	01-2017	02-2019	01-2021	01-2023	Trend
Revenue	3.8%	4.4%	4.2%	1.2%	0.2%
Net Income	1.3%	-6.9%	-5.7%	-3.5%	-0.4%
Stockholders Equity	8.2%	8.1%	6.6%	16%	-0.44%
FCF	26%	19%	-10%	100%	6.3%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +4.37%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +0.2%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is -6.95%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is -0.4%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +8.05%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is -0.44%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is +19.23%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is +6.34%.