Trade-Ideas: Kroger (KR) Is Today's New Lifetime High Stock

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.

Trade-Ideas LLC identified Kroger ( KR) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Kroger as such a stock due to the following factors:

  • KR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $483.5 million.
  • KR has traded 83,349 shares today.
  • KR is trading at a new lifetime high.

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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%. KR has a PE ratio of 23.2. Currently there are 8 analysts that rate Kroger a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Kroger has been 4.2 million shares per day over the past 30 days. Kroger has a market cap of $36.7 billion and is part of the services sector and retail industry. Shares are up 18.8% year-to-date as of the close of trading on Thursday.

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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, notable return on equity, good cash flow from operations, solid stock price performance and impressive record of earnings per share growth. 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:
  • KR's revenue growth has slightly outpaced the industry average of 0.2%. Since the same quarter one year prior, revenues slightly increased by 8.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 28.39% and other important driving factors, this stock has surged by 73.90% over the past year, outperforming the rise in the S&P 500 Index during the same period. 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 28.4% 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 $3.45 versus $2.90 in the prior year. This year, the market expects an improvement in earnings ($3.85 versus $3.45).
  • 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 22.7% when compared to the same quarter one year prior, going from $422.00 million to $518.00 million.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength 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.

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