In their note this morning, the firm said, "The company is a leading wholesale distributor and retailer in the grocery sector. Over the past few quarters, a new management team led by CEO Sam Duncan has helped to stabilize the enterprise and is now looking to execute upon the next phase of the turnaround.
"We believe SVU has all the makings of a successful early stage retail turnaround story with strong management, underproductive assets, stable financial profile, and muted investor expectations. We have learned with turnaround stories that forecasting near-term results can be a difficult exercise, and SUPERVALU is no different.
"The shares are appropriate for investors with a long-term horizon, in our view."
Separately, TheStreet Ratings team rates SUPERVALU INC as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
"We rate SUPERVALU INC (SVU) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year, revenue growth and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and poor profit margins."