Kroger (NYSE:KR) Posts Quarterly Earnings Results, Beats Expectations By $0.08 EPS

Kroger (NYSE:KR) issued its quarterly earnings data on Thursday. The company reported $1.28 EPS for the quarter, topping analysts’ consensus estimates of $1.20 by $0.08, FiscalAI reports. The business had revenue of $34.73 billion for the quarter, compared to analyst estimates of $35.10 billion. Kroger had a net margin of 0.54% and a return on equity of 38.06%. The firm’s quarterly revenue was up 1.2% on a year-over-year basis. During the same period last year, the business posted $1.14 earnings per share. Kroger updated its FY 2026 guidance to 5.100-5.300 EPS.

Here are the key takeaways from Kroger’s conference call:

• Leadership change: Greg Foran is the new CEO and plans to accelerate top‑line growth by focusing on price, fresh execution, e‑commerce, AI and faster operational execution across stores and digital channels.
• E‑commerce acceleration and profitability target: Adjusted e‑commerce grew 20% in Q4 to a $16 billion business, and Kroger expects e‑commerce to reach profitability in 2026 driven by a hybrid store‑based fulfillment model and third‑party partners (Instacart, DoorDash, Uber Eats).
• Solid near‑term results: Q4 identical sales without fuel rose 2.4% (FY +2.9%), Q4 adjusted EPS was $1.28 (+12%) and full‑year adjusted EPS was $4.85 (+9%), with positive market share gains in the final period.
• 2026 guidance and investments: Kroger guided identical sales without fuel of 1–2% (2.3–3.3% ex‑IRA), adjusted FIFO operating profit of $5.0–$5.2B and adj. EPS $5.10–$5.30 while planning bigger price and service investments funded by targeted cost savings in procurement and e‑commerce and higher store openings.
• Cost actions and cash‑flow/headwinds: Management is selling Vitacost and closing ~50 Little Clinic sites, reported a $157M LIFO charge ($0.07 EPS headwind), and guided 2026 adjusted free cash flow down to $2.7–$2.9B despite strong 2025 cash generation, which could pressure near‑term liquidity and execution risk.

Kroger Stock Performance

NYSE KR opened at $71.61 on Friday. The firm has a market capitalization of $45.32 billion, a P/E ratio of 66.31, a price-to-earnings-growth ratio of 1.73 and a beta of 0.62. The company has a current ratio of 0.88, a quick ratio of 0.45 and a debt-to-equity ratio of 2.28. The firm’s fifty day moving average price is $65.13 and its two-hundred day moving average price is $65.89. Kroger has a 1 year low of $58.60 and a 1 year high of $74.90.

Kroger Announces Dividend

The company also recently announced a quarterly dividend, which was paid on Sunday, March 1st. Investors of record on Friday, February 13th were issued a dividend of $0.35 per share. This represents a $1.40 dividend on an annualized basis and a yield of 2.0%. The ex-dividend date was Friday, February 13th. Kroger’s payout ratio is presently 129.63%.

Key Headlines Impacting Kroger

Here are the key news stories impacting Kroger this week:

• Positive Sentiment: Q4 profit beat and margin strength — Kroger reported adjusted EPS above expectations and improved operating margins driven by sourcing gains; management also flagged 20% e‑commerce growth, which helped the beat. Kroger Reports Fourth Quarter and Full-Year 2025 Results
• Positive Sentiment: New CEO sets a value play — Greg Foran’s first public comments emphasize lower in‑store prices, better deals, faster e‑commerce and AI to drive sales and market share; investors are treating this as a credible operational reset. New Kroger CEO Greg Foran outlines top priorities
• Positive Sentiment: Expanded capital returns — the board approved an extra $2B repurchase authorization (on top of recent ASR activity), supporting EPS leverage and signaling shareholder-friendly management. Kroger Reports Fourth Quarter and Full-Year 2025 Results
• Positive Sentiment: Analyst support — Telsey raised its price target and the consensus analyst sentiment sits around “Moderate Buy,” which helps underpin the rally. Benzinga: Telsey raises price target
• Neutral Sentiment: Cautious FY26 outlook — Kroger set FY26 adjusted EPS guidance slightly above consensus ( $5.10–$5.30 ) but gave conservative sales guidance; investors view guidance as balanced — supportive on EPS but cautious on top‑line growth. MarketWatch: Guidance and sales misses
• Neutral Sentiment: E‑commerce strategic review — management says the e‑commerce review should deliver ~ $400M of operating profit improvement in 2026, a positive structural step but one that will take time to fully materialize. PR Newswire: eCommerce review
• Negative Sentiment: Product recall risk — frozen food recall (Ajinomoto product sold at Kroger/Trader Joe’s in Illinois) for glass contamination poses a reputational and potential short‑term cost issue. IndyStar: Ajinomoto recall
• Negative Sentiment: Operational cuts and closures — Kroger is closing Little Clinic locations and has shuttered underperforming stores/laid-off staff in some markets; these actions reduce costs but also signal restructuring headwinds. Yahoo: Kroger closing Little Clinic locations
• Negative Sentiment: Labor and legal risks — union tensions and class‑action suits over e‑commerce worker classification create ongoing downside risk and potential litigation costs. GroceryDive: e‑commerce lawsuits

Hedge Funds Weigh In On Kroger

A number of hedge funds and other institutional investors have recently bought and sold shares of KR. State Street Corp raised its stake in Kroger by 1.2% in the third quarter. State Street Corp now owns 31,948,112 shares of the company’s stock valued at $2,153,622,000 after buying an additional 386,503 shares during the period. GQG Partners LLC increased its holdings in shares of Kroger by 11.3% during the 4th quarter. GQG Partners LLC now owns 13,398,072 shares of the company’s stock worth $837,113,000 after acquiring an additional 1,360,946 shares during the last quarter. Dimensional Fund Advisors LP raised its stake in Kroger by 1.0% in the 4th quarter. Dimensional Fund Advisors LP now owns 12,242,401 shares of the company’s stock valued at $764,932,000 after acquiring an additional 122,606 shares during the period. Invesco Ltd. lifted its holdings in Kroger by 7.7% during the 4th quarter. Invesco Ltd. now owns 6,816,240 shares of the company’s stock valued at $425,879,000 after purchasing an additional 489,058 shares during the last quarter. Finally, UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC boosted its position in Kroger by 3.7% during the fourth quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 6,076,142 shares of the company’s stock worth $379,637,000 after purchasing an additional 216,728 shares during the period. Institutional investors own 80.93% of the company’s stock.

Analyst Ratings Changes

Several analysts have issued reports on KR shares. Morgan Stanley set a $73.00 price target on Kroger in a research note on Thursday. JPMorgan Chase & Co. dropped their target price on Kroger from $73.00 to $71.00 and set a “neutral” rating on the stock in a research report on Friday, December 5th. Citigroup reaffirmed a “neutral” rating and set a $68.00 price target (down from $74.00) on shares of Kroger in a research report on Wednesday, December 10th. Wells Fargo & Company cut shares of Kroger from an “overweight” rating to an “equal weight” rating and decreased their price target for the stock from $70.00 to $68.00 in a research note on Wednesday, February 25th. Finally, Jefferies Financial Group reissued a “buy” rating and issued a $82.00 price objective on shares of Kroger in a research report on Thursday. Eight research analysts have rated the stock with a Buy rating and eight have issued a Hold rating to the company. According to MarketBeat.com, Kroger currently has a consensus rating of “Moderate Buy” and an average price target of $74.19.

About Kroger

The Kroger Co (NYSE: KR) is one of the largest supermarket operators in the United States, offering a wide range of retail grocery and related services. Founded in Cincinnati in 1883 by Bernard Kroger, the company operates a portfolio of supermarket and multi-department store banners and provides customers with fresh foods, packaged groceries, deli and bakery items, meat and seafood, produce, and prepared foods. Kroger’s stores commonly include pharmacy services and fuel centers, positioning the company as a broad-based neighborhood retail destination for everyday needs.

In addition to traditional in-store retailing, Kroger manufactures and distributes a variety of private-label brands and operates its own food production and supply-chain facilities.