Shares of food and drug retailer Albertsons Companies (ACI) have soared in price since the company reported impressive second-quarter earnings on October 18. But can the stock maintain its rally in a high-inflation environment? Let’s find out.Shares of leading food and drug retailer Albertsons Companies, Inc. (ACI) have advanced 7.2% in price since the company reported its second-quarter results on October 18. Its same-store sales in the quarter exceeded analysts’ expectations. The stock has gained 74.4% year-to-date and 51.4% over the past three months to close yesterday’s trading session at $30.65.
The Boise, Idaho, company expects higher inflation in the coming months, driven by higher supply-chain and labor costs across the food industry. But it offers cheaper alternatives to high-priced products.
ACI has been strengthening its digital presence. To that end, it unveiled three innovations in August 2021—the launch of its free Deals & Delivery app; ‘Albertsons for U’ shopper loyalty program; and FreshPass. The company increased its quarterly dividend by 20% to $0.12 per share, payable on November 12. Furthermore, it also raised its full-year 2021 guidance. So, ACI’s near-term prospects look promising.