For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
FOMO, or the fear of missing out, also plays a role in investing, particularly with tech giants and popular consumer-facing stocks.
What if you'd invested in Kroger (NYSE:KR) ten years ago? It may not have been easy to hold on to KR for all that time, but if you did, how much would your investment be worth today?
Kroger's Business In-Depth
With that in mind, let's take a look at Kroger's main business drivers.
The Kroger Co. (KR), which operates in the thin-margin grocery industry, has been undergoing a complete makeover, not only with respect to products but also in terms of the way consumers prefer shopping grocery. The company is launching plant-based products as well as eyeing technological expansion. It acquired meal kit company Home Chef and partnered with British online grocery delivery firm Ocado (LON:OCDO) that reinforces its position in the online ordering, automated fulfillment and home delivery space. It has also introduced grocery delivery service Kroger Ship and inked a deal with driverless car company Nuro.
This Cincinnati, Ohio-based company operates supermarkets under banners including Kroger, City Market, Dillons, Food 4 Less, Fred Meyer, Fry's, Harris Teeter, Jay C, King Soopers, Mariano's, Pick 'n Save, QFC, Ralphs and Smith's. Further, it also manufactures and processes certain food products that are sold in its supermarkets.
Kroger’s supermarket and multi-department stores operate under four formats combo stores (combination of food and drug stores), multi-department stores, marketplace stores, and price impact warehouses. The combo stores include natural food and organic sections, pharmacies, general merchandise, and pet centers, as well as offer perishables items such as fresh seafood and organic produce.
The multi-department stores offer a collection of general merchandise products such as apparel, home fashion and furnishings, electronics, automotive products, toys, and fine jewelry. The marketplace stores include full-service grocery and pharmacy departments and a general merchandise area that includes outdoor living products, electronics, home goods, and toys.
The combo stores, multi department stores, and marketplace stores also have fuel centers. The price impact warehouse offers grocery, health, and beauty care items.
Bottom Line
Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in Kroger ten years ago, you're likely feeling pretty good about your investment today.
A $1000 investment made in September 2011 would be worth $4,042.46, or a 304.25% gain, as of September 6, 2021, according to our calculations. Investors should note that this return excludes dividends but includes price increases.
Compare this to the S&P 500's rally of 286.33% and gold's return of -6.47% over the same time frame.
Going forward, analysts are expecting more upside for KR.
Shares of Kroger have increased and outpaced the industry in the past three months. The company is undertaking every effort to strengthen position not only with respect to products but also in terms of the way consumers shop. It has been making investments to enhance product freshness and quality as well as expand digital capabilities. Such aspects supported the company, when it reported better-than-expected first-quarter fiscal 2021 results. Speaking of bolstering digital operations, we note that the company has been focusing on expanding delivery and payment solutions. Additionally, it has been augmenting “Our Brands” portfolio by launching several new products. Further, management raised its fiscal 2021 projections. However, the raised view continues to suggest tough year-on-year comparison due to the lapping of pandemic-led benefits.
Over the past four weeks, shares have rallied 11.74%, and there have been 2 higher earnings estimate revisions in the past two months for fiscal 2021 compared to none lower. The consensus estimate has moved up as well.5 Stocks Set to Double
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The Kroger Co. (KR): Free Stock Analysis Report
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