Today's Unusual Social Activity Stock: Kroger (KR)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Kroger ( KR) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified Kroger as such a stock due to the following factors:

  • KR has more that 20x the normal benchmarked social activity for this time of the day compared to its average of 3.10 mentions/day.
  • KR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $188.1 million.

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.

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More details on KR:

The Kroger Co., together with its subsidiaries, operates as a retailer worldwide. The company also manufactures and processes food for sale in its supermarkets. It operates retail food and drug stores, multi-department stores, jewelry stores, and convenience stores. The stock currently has a dividend yield of 1.2%. KR has a PE ratio of 19.6. Currently there are 9 analysts that rate Kroger a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Kroger has been 3.3 million shares per day over the past 30 days. Kroger has a market cap of $29.4 billion and is part of the services sector and retail industry. The stock has a beta of 1.22 and a short float of 1.9% with 2.97 days to cover. Shares are up 50.5% year-to-date as of the close of trading on Tuesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Kroger as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, growth in earnings per share, increase in net income and notable return on equity. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 0.9%. Since the same quarter one year prior, revenues rose by 11.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 41.16% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, KR should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • KROGER CO has improved earnings per share by 16.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, KROGER CO increased its bottom line by earning $2.90 versus $2.77 in the prior year. This year, the market expects an improvement in earnings ($3.29 versus $2.90).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Food & Staples Retailing industry average. The net income increased by 9.5% when compared to the same quarter one year prior, going from $317.00 million to $347.00 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Food & Staples Retailing industry and the overall market, KROGER CO's return on equity significantly exceeds that of both the industry average and the S&P 500.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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