Kroger Stock Spikes on Earnings Beat - TheStreet

Kroger Stock Spikes on Earnings Beat

Kroger posts a decline in first-quarter profit, but manages to top expectations.
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NEW YORK (

TheStreet

) -

Kroger

(KR) - Get Report

posted a first-quarter decline as costs rose.

Still the grocery chain managed to beat Wall Street's estimates, earning $373.7 million, or 58 cents a share, from $435.1 million, or 66 cents, in the year-ago period. Analysts were calling for earnings of 54 cents a share for Kroger.

Kroger sales jumped nearly 9% to $24.8 billion, with a boost from gasoline sales. Identical grocery store sales gained 2.4% during the quarter.

The company reaffirmed its full-year outlook of $1.60 to $1.80 a share.

Kroger gave investors hope that traditional grocers can hold their own against growing competition from discounter

Wal-Mart

(WMT) - Get Report

. Food and other grocery items accounted for 50% of Wal-Mart's sales in 2009.

The discount bohemoth also announced last month that it was expanding its roll-backs to grocery items.

Shares of Kroger jumped 4.8% to $21.05 in early morning trading Thursday and pulled up the stocks of rival grocers.

Safeway

(SWY)

is gaining 1.4% to $21.58, while

Supervalu

(SVU)

is rising 2.6% to $12.81.

-- Reported by Jeanine Poggi in New York.

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