KROGER - INTERESTING DIVIDEND
Kroger $KR+0.4% is a major player in the grocery retail market, and its strong position in the industry has delivered solid financial results even during economic uncertainty. The company benefits from its extensive network of local stores that serve a wide range of customers, and this allows it to deliver long-term returns to shareholders in the range of 8% to 11% annually. Despite these successes, Kroger stock trades at a low multiple of earnings, making it an attractive investment through 2024.
Kroger's benefits in the context of inflation
In the past year, when inflation has been unusually high, $KR+0.4% has surprisingly benefited from this situation. This is because eating at home is generally cheaper than eating out, which attracts more customers to the company's stores. This trend was reflected in the company's financial results - in its most recent quarter, the company reported comparable sales growth of 6.9%, and adjusted earnings grew even faster at 12.8%. This profit growth exceeded the company's long-term target of between 3% and 5% annual growth.
Reinvestment and growth strategy
One of the key aspects of $KR'+0.4%s success is its ability to reinvest profits into its stores, which increases foot traffic, sales and overall profits. This strategy also includes investing in higher-margin revenue sources such as private labels, which are increasingly popular among consumers.
Dividend policy
$KR+0.4% remains a profitable company that is committed to paying dividends. In the past four quarters, the company has paid out more than a third of its earnings in dividends, which equates to a dividend yield of approximately 2.04%. This yield, coupled with an attractive price-to-earnings ratio of 11 based on estimates of future earnings, makes Kroger a solid investment in the current volatile market environment.
$KR+0.4% represents a stable and profitable investment with opportunities for further growth. The low earnings multiple and attractive dividend yield make it an interesting choice for investors seeking stability and growth potential in uncertain times.
Fine company, I used to look at them, but I don't want their stock in my portfolio.
I traded this stock in early 2022 when it was peaking. Looks like it's at very similar levels now. I would only consider it from that perspective though. As an investment, I personally don't like it that much.