The Kroger Co. (KR) AI Stock Analysis
KR AI stock analysis summary
AI ResearchThe Kroger Co. is a major US supermarket operator with $149.33B in trailing twelve month revenue. Annual net income fell to $1.02B in FY2026, but quarterly earnings grew 15.3% year-over-year in the latest period. The stock trades at a forward P/E of 11.3x and carries net debt of $22.48B.
- Market cap
- $37.58B
- Revenue (TTM)
- $149.33B
- P/E
- 35.4x fwd 11.3x
- 1Y return
- -5.5% S&P 500 16.8%
- Avg. target
- $68.32 7.4% vs last close
Bull case
- The stock trades at a forward P/E of 11.3x, lower than the median of 15.3x for its S&P 500 Consumer Defensive peers.
- Free cash flow reached $3.35B in FY2026, supporting $2.70B in share buybacks and a 5-year share count change of -19.1%.
- Quarterly earnings grew 15.3% year-over-year in the latest period ended July 31, 2026.
Bear case
- Total debt reached $24.16B as of July 31, 2026, leading to a debt-to-equity ratio of 4.14 and net debt of $22.48B.
- Trailing twelve-month net profit margin remained thin at 0.7%, while operating margin was 3.0%.
- The 1-year stock return was -5.5%, trailing the S&P 500 return of 16.8%.
What Kroger does
The Kroger Co. is a prominent retailer operating 2,726 supermarkets under various banners across 35 states and the District of Columbia. Its stores include combination food and drug stores featuring natural and organic foods, pharmacies, fresh produce, and seafood. The company also operates multi-department stores, Marketplace stores, price impact warehouse stores, and 1,613 fuel centers. Beyond physical retail and online platforms, Kroger is actively involved in food manufacturing and processing.
Growth and profitability
Kroger posted revenue of $147.64B in FY2026, up 0.4% from $147.12B in FY2025 and generating a 5-year revenue CAGR of 2.2% from FY2021 to FY2026. Gross margin rose to 23.3% in FY2026, while operating margin fell to 1.3% and net income landed at $1.02B. Over the trailing twelve months, revenue reached $149.33B with an operating margin of 3.0% and a net profit margin of 0.7%. For the quarter ended July 31, 2026, quarterly revenue grew 2.0% year-over-year, and quarterly earnings grew 15.3%.
Balance sheet and cash flow
As of July 31, 2026, Kroger held $1.68B in cash and short-term investments against $24.16B in total debt, resulting in net debt of $22.48B. Shareholders' equity stood at $5.84B, with a debt-to-equity ratio of 4.14 and a current ratio of 0.70. In FY2026, the company generated $7.21B in operating cash flow and $3.35B in free cash flow. Cash deployment included $3.85B in capital expenditures, $2.70B in share buybacks, and $885.0M in dividends paid, contributing to a 5-year share count change of -19.1%.
Valuation and performance
Kroger closed at $63.63 with a market capitalization of $37.58B and an enterprise value of $56.01B. The stock trades at a trailing P/E of 35.4x compared to the median of 23.3x for its S&P 500 Consumer Defensive peers. Its forward P/E of 11.3x and EV/EBITDA of 9.6x sit below peer group medians of 15.3x and 14.8x, respectively. Over the past year, the stock returned -5.5%, underperforming the 16.8% return of the S&P 500 (SPY), while its 5-year return of 83.8% matched the 83.0% return of the benchmark.
KR dividend
Kroger pays a quarterly dividend with a forward annualized amount of $1.56, offering a dividend yield of 2.45%. The payout ratio is 29.6%, and the company has paid dividends for 21 consecutive years. Its 5-year annualized dividend growth rate is 14.5%, and the last ex-dividend date was November 16, 2026.
What analysts expect
Wall Street sentiment reflects 12 Strong Buy, 1 Buy, and 11 Hold recommendations. The mean price target is $68.32, which is 7.4% above the last close of $63.63. For the fiscal year ending January 31, 2027, consensus estimates project EPS of $5.18 and revenue of $150.72B. The company beat EPS estimates in 3 of the last 4 quarters, and the next earnings date is December 3, 2026.
Key risks and what to watch
- A current ratio of 0.70 as of July 31, 2026, highlights tight working capital liquidity.
- Net income dropped from $2.67B in FY2025 to $1.02B in FY2026 as operating margin compressed to 1.3%.
- Five-year revenue CAGR stands at 2.2%, indicating modest long-term top-line expansion.
AI-generated research summary. Written with AI from Quotelinks data as of October 16, 2026 and checked so every figure matches that data. For information only, not investment advice. Disclaimer
About this KR AI stock analysis
This page is an AI-written research summary of The Kroger Co. (KR). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.
Related: KR income statement, KR balance sheet, KR key metrics, KR analyst forecast, KR chart. See the KR stock overview for the latest quote and news.
KR AI stock analysis FAQ
What is Kroger's dividend yield and payment track record?
Kroger offers a forward dividend yield of 2.45% based on an annual dividend of $1.56. The company has paid dividends for 21 consecutive years, supported by a 29.6% payout ratio.
What are analysts' price targets for Kroger stock?
Analysts have an average price target of $68.32, which implies a 7.4% upside compared to the last close of $63.63. The recommendation breakdown includes 12 Strong Buys, 1 Buy, and 11 Holds.
How leveraged is Kroger's balance sheet?
As of July 31, 2026, Kroger held $1.68B in cash against $24.16B in total debt, leaving net debt at $22.48B. Its debt-to-equity ratio is 4.14, and its current ratio is 0.70.
When does Kroger report its next earnings?
Kroger is scheduled to release earnings on December 3, 2026. For the current fiscal year ending January 31, 2027, analysts estimate EPS of $5.18 and revenue of $150.72B.