Why Kroger Decided to Sell Its Convenience Store Business
The convenience store business was Kroger’s non-core business. Kroger announced its intention to explore strategic alternatives in October 2017.
On February 6, 2018, Kroger announced that it has entered into a definitive agreement with EG Group regarding the sale of its convenience store business.
According to a recent New York Post report, Kroger (KR), America’s largest supermarket chain, is reportedly in business development talks with Alibaba.
After pioneering the e-commerce space, Amazon is increasing its brick-and-mortar presence. In August 2017, the company acquired Whole Foods for $13.5 billion.
Dollar Tree (DLTR) is currently trading at a one-year-forward price-to-earnings ratio (or PE) of 20.6x, in line with its three-year average of 20.3x.
Analyst Rupesh Parikh of Oppenheimer initiated coverage of Dollar Tree (DLTR) with an “outperform” rating on Wednesday, January 17.
Analyst Rupesh Parikh of Oppenheimer initiated coverage on Dollar General (DG) with an “outperform” rating on Wednesday, January 17.
Oppenheimer initiated coverage on discount stores Dollar Tree (DLTR) and Dollar General (DG) with an “outperform” rating on Wednesday, January 17.
Dollar Tree (DLTR) has continued its solid performance into 2018. The discount retailer has already risen 7% during the first two weeks of the new year as of January 12, 2018.
Dollar Tree (DLTR) is rated a 2.1 on a scale of 1 (“strong buy”) to 5 (“strong sell”) by Wall Street analysts.
On Thursday, January 11, 2018, Guggenheim initiated coverage on discount retailer Dollar Tree (DLTR) with a “buy” rating.
According to a recent report by Forbes, America’s largest supermarket chain Kroger (KR) is reportedly in talks to buy Boxed—an online bulk order wholesaler.
Supervalu (SVU) reported mixed 3Q18 results and changed its fiscal guidance on January 10. It stock price fell 13.7% on January 10 due to the soft results.
Mixed results and the revised guidance triggered a fall in Supervalu stock. Its share price fell 13.7% to $16.94 on January 10.
Supervalu’s gross profit improved marginally to $411 million during 3Q18. However, the gross margin fell by more than 300 basis points to 10.5% of sales.
Supervalu (SVU) reported 31.1% growth in its 3Q18 top line to $3.94 billion. Most of the increase was driven by its recent acquisition of Unified Grocers.
A drop in Supervalu’s stock price drove its valuations down after its 3Q18 results. It’s trading at 6.3x—at the lower end of its 52-week PE ratio range.
Walmart had a superb run in the stock market this year. It rose ~43% during 2017. Analysts expect a modest increase of ~3% in its stock price going forward.
Industry leader Walmart (WMT) emerged as a clear winner in the price war. It even beat dollar stores and became the cheapest retailer in the country.
Sprouts Farmers Market trades at a premium to other players and is valued at 23x. However, it also has the best earnings potential.