La vendita allo scoperto per Albertsons Companies dà agli investitori un'idea del grado in cui gli investitori stanno scommettendo sul declino delle azioni di Albertsons Companies. I dati relativi alle vendite allo scoperto vengono aggiornati ogni due settimane.

Albertsons Companies (NYSE:ACI) Azioni, Report sulle vendite allo scoperto

Albertsons Companies

Albertsons is the second largest supermarket operator in the United States with over 2,200 stores across a variety of banners. About 80% of the firm's sales stem from non-perishable and fresh food, of which 25% comes from its portfolio of private brands. The company also operates fuel centers and pharmacies at about 20% and 75% of its store locations, respectively. Albertsons went public in 2020 following years of ownership under private equity firm Cerberus Capital Management, which still owns about a fourth of outstanding shares.

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Albertsons Companies (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) is set to give its latest quarterly earnings report on Tuesday, 2024-10-15. Here's what investors need to know before the announcement.
Analysts estimate that Albertsons Companies will report an earnings per share (EPS) of $0.48. 
Investors in Albertsons Companies are eagerly awaiting the company's announcement, hoping for news of surpassing estimates and positive guidance for the next quarter.
It's worth noting for new investors that stock prices can be heavily influenced by future projections rather than just past performance.
<h3>Overview of Past Earnings</h3>
In the previous earnings release, the company missed EPS by $0.01, leading to a 0.1% drop in the share price the following trading session.
Here's a look at Albertsons Companies's past performance and the resulting price change:

<table>
<thead>
<tr>
<th>Quarter</th>
<th>Q1 2024</th>
<th>Q4 2023</th>
<th>Q3 2023</th>
<th>Q2 2023</th>
</tr>
</thead>
<tbody>
<tr>
<td>EPS Estimate</td>
<td>0.67</td>
<td>0.52</td>
<td>0.65</td>
<td>0.56</td>
</tr>
<tr>
<td>EPS Actual</td>
<td>0.66</td>
<td>0.54</td>
<td>0.79</td>
<td>0.63</td>
</tr>
<tr>
<td>Price Change %</td>
<td>-0.0%</td>
<td>0.0%</td>
<td>-0.0%</td>
<td>-0.0%</td>
</tr>
</tbody>
</table>

<img src="https://www.benzinga.com/files/images/story/2024/1728925219_0.png" alt="eps graph" />
<h3>Tracking Albertsons Companies's Stock Performance</h3>
Shares of Albertsons Companies were trading at $18.37 as of October 11. Over the last 52-week period, shares are down 19.3%. Given that these returns are generally negative, long-term shareholders are likely a little upset going into this earnings release. 
<a href="https://www.benzinga.com/quote/ACI/earnings">To track all earnings releases for Albertsons Companies visit their earnings calendar on our site.</a>
This article was generated by Benzinga's automated content engine and reviewed by an editor.

Earnings

Earnings Preview: Albertsons Companies

On Friday, Albertsons Companies, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) voluntarily recalled 12 types of ReadyMeals and deli items supplied by Fresh Creative Foods due to potential contamination <a target="_blank" href="https://www.benzinga.com/pressreleases/24/10/b41300393/albertsons-companies-voluntarily-recalls-12-readymeals-and-store-made-deli-items-containing-a-reca" rel="noreferrer noopener">with Listeria monocytogenes</a>.
The recalled ReadyMeals and deli items were sold at Albertsons, Safeway, Jewel-Osco, Vons, and stores across several states, including California, Texas, Illinois, and Washington.
The recall was prompted by Fresh Creative Foods&#8217; action after routine tests by the U.S. Department of Agriculture&#8217;s Food Safety and Inspection Service (FSIS) detected contamination in a ready-to-eat chicken ingredient from BrucePac in Durant, Oklahoma.
Listeria can cause serious infections in vulnerable groups, including the elderly, young children, and pregnant women, leading to symptoms like fever, nausea, and, in severe cases, miscarriages.
The company said those at risk should seek medical care if they experience flu-like symptoms after consuming contaminated food.
In September, Albertsons launched Bee Lightly, which features an innovative flat bottle made from 100% recycled PET— a<a target="_blank" href="https://www.benzinga.com/pressreleases/24/09/b41003147/albertsons-companies-launches-highly-rated-bee-lightly-wines-redefining-wine-packaging" rel="noreferrer noopener"> first in the U.S. wine industry</a>.
Investors can gain exposure to the stock via First Trust Cons. Staples AlphaDEX (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FXG#NYSE">FXG</a>).
Price Action: ACI shares are up 0.05% at $18.38 premarket at the last check Monday.
Read Next:
<ul>
<li><a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/10/41272661/why-shrinking-price-differences-between-walmart-kroger-and-albertsons-matter-to-inv" target="_blank" rel="noreferrer noopener">Why Shrinking Price Differences Between Walmart, Kroger, And Albertsons Matter To Investors</a></li>
</ul>

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Listeria Scare Prompts Albertsons To Recall Certain Ready-To-Eat Meals In Multiple States

The recall was initiated because these products contain a recalled ready-to-eat chicken ingredient supplied by BrucePac of Durant, Okla., which was found to be contaminated with&nbsp;Listeria monocytogenes during routine tests by the U.S. Department of Agriculture&#39;s Food Safety and Inspection Service (FSIS).

Reported Saturday, Albertsons Recalls ReadyMeals And Deli Items Across Multiple States Following Listeria Concerns

Telsey Advisory Group analyst Joe Feldman maintains Albertsons Companies (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) with a Market Perform and maintains $27.25 price target.

Price Target

Analyst Ratings

Telsey Advisory Group Maintains Market Perform on Albertsons Companies, Maintains $27.25 Price Target

Recent data from JPMorgan's exclusive survey indicates <a href="https://www.benzinga.com/news/24/08/40467624/harris-price-gouging-plan-faces-pushback-from-grocers-hurting-from-the-same-inflationary-pressure-as">that price gaps</a> between Walmart Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/WMT#NYSE">WMT</a>) and competitors like Kroger Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KR#NYSE">KR</a>) and Albertsons Companies Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) are narrowing.
Kroger has traditionally maintained higher prices than Walmart, resulting in a price premium over its competitor. However, a recent shift in pricing strategies could signal a change in the competitive landscape as companies adjust to attract increasingly price-sensitive consumers. Notably, Kroger has reported a 2% decrease in its tracked prices since June 2024, marking the most significant decline recorded since the survey began.
<h2 class="wp-block-heading">Price Trends, Consumer Behavior</h2>
Walmart has raised its prices by 1.7%, while Albertsons and Sprouts Farmers Market Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SFM#NYSE">SFM</a>) have increased their prices by 1.4%, which contrasts sharply with Kroger's recent price cuts. These changes highlight a shift in consumer sentiment as shoppers prioritize value.
As a result, Kroger&#8217;s price premium over Walmart has fallen to 10%, down from 13.3% in June, making it more competitive in a market where consumers are increasingly conscious of pricing. 
Meanwhile, Albertsons' prices have increased 5.8% since August 2023, potentially leading to a decline in customer loyalty and sales.
Read Also: <a href="https://www.benzinga.com/markets/asia/24/10/41229835/walmart-retail-juggernaut-has-more-room-to-grow-for-investors" target="_blank" rel="noreferrer noopener">Walmart: Retail Juggernaut Has More Room to Grow for Investors</a>
<h2 class="wp-block-heading">Implications For Investors</h2>
The narrowing price gaps could have significant implications for investors. 
Companies that effectively manage perishables and focus on maintaining competitive pricing may see enhanced market shares and improved earnings. 
Notably, while Kroger is cutting prices to stay competitive, Albertsons has invested heavily in perishables, resulting in a 3.2% decline in pricing for this category. SFM, conversely, saw prices rise 4.6%, which might position it differently in terms of market strategy.
As these companies prepare for upcoming earnings reports, investors should closely monitor how they adapt to inflationary pressures and changing consumer preferences. 
The insights provided by JPMorgan underscore the importance of strategic pricing in navigating the competitive grocery landscape. Investors should carefully evaluate each retailer's approach to pricing to make informed decisions.
Read Next: 
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<li><a href="https://www.benzinga.com/m-a/24/09/40909304/kroger-albertsons-shares-dip-after-ftc-gives-closing-arguments-in-hearing-to-block-merger">Kroger, Albertsons Shares Dip After FTC Gives Closing Arguments In Hearing To Block Merger</a></li>
</ul>
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Analyst Color

Long Ideas

Retail Sales

Trading Ideas

Why Shrinking Price Differences Between Walmart, Kroger, And Albertsons Matter To Investors

&nbsp;The Kroger Co. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KR#NYSE">KR</a>) (the "Company" or "Kroger") announced today that it has extended the expiration date of the previously announced offers to exchange (the "Exchange Offers") any and all outstanding notes (the "ACI Notes") of Albertsons Companies, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) ("ACI"), New Albertsons, L.P., Safeway Inc., Albertson's LLC, Albertsons Safeway LLC and American Stores Company, LLC, as applicable, for up to $7,441,608,000 aggregate principal amount of new notes to be issued by the Company (the "Kroger Notes") and cash. Additionally, Kroger announced today that it has extended the expiration date for the related solicitations of consents (collectively, the "Consent Solicitations") to adopt certain proposed amendments (the "Proposed Amendments") to the indentures (collectively, the "ACI Indentures") governing the ACI Notes, solely with respect to the Unconsented Series (as defined in the Company's press release issued on September 11, 2024). The Company hereby extends such expiration date from 5:00 p.m. New York City time on October 9, 2024 to 5:00 p.m. New York City time on October 16, 2024 (as the same may be further extended, the "Expiration Date").
&nbsp;
As of August 29, 2024, the requisite number of consents were received to adopt the Proposed Amendments with respect to the Consented Series (as defined in the Company's press release issued on September 11, 2024), and the relevant parties had executed supplemental indentures to the applicable ACI Indentures implementing the Proposed Amendments. The Proposed Amendments will only become operative upon the settlement of the Exchange Offers, which is expected to occur promptly after the Expiration Date.
Tenders of ACI Notes made pursuant to the Exchange Offers (but not consents delivered pursuant to the Consent Solicitations) may be validly withdrawn at or prior to the Expiration Date.

Kroger Extends Deadline for Albertsons Notes Exchange Offers and Consent Solicitations to October 16 (From Prior October 9)

When word got around that Spirit Airlines, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SAVE#NYSE">SAVE</a>) was <a href="https://www.benzinga.com//node/41182466">considering a bankruptcy</a> filing, critics quickly took to social media to blame the Biden administration. 
Why? Recall how, in January, U.S. <a href="https://www.benzinga.com/news/24/01/36648448/jetblue-spirit-airlines-merger-blocked-spirit-shares-tumble">antitrust regulators successfully blocked</a> JetBlue Airways Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/JBLU#NASDAQ">JBLU</a>) from buying Spirit for $3.8 billion. Indeed, over the past four years, regulators <a href="https://www.benzinga.com/government/24/09/40693260/kroger-albertsons-merger-in-ftc-crosshairs-customers-competitors-at-risk">often hold up</a> M&amp;A activity they consider anti-competitive, such as <a href="https://www.benzinga.com/news/large-cap/22/10/29266605/kroger-albertsons-finally-seal-the-rumored-merger-deal-see-highlights">the $25 billion merger</a> between Kroger Co. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KR#NYSE">KR</a>) and Alberstons Companies, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>).
The JetBlue/Spirit scenario was no different. Fast-forward to this week: The <a href="https://www.wsj.com/articles/spirit-airlines-in-talks-with-bondholders-over-terms-of-potential-bankruptcy-filing-fdd23fae">Wall Street Journal</a> reported Spirit is in talks with bondholders and creditors to see if a Chapter 11 bankruptcy is the best option for the troubled carrier.
<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"> 
<div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="500" data-dnt="true">Biden and Harris torched the merger. Now many will be without a job.
&mdash; Ottoman (@raddadcomments) <a href="https://twitter.com/raddadcomments/status/1841958271655280659?ref_src=twsrc%5Etfw">October 3, 2024</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
</figure>
The JetBlue deal would have saved jobs and the airline, observers argued. It&#8217;s worth noting Spirit&#8217;s problems stem from having to ground several Airbus planes due to turbofan engine problems.
Bank of America Securities analysts noted in January that Spirit&#8217;s ongoing engine repairs hurt &#8220;the traditional ultra-low cost business model.&#8221;
Dania Beach, Florida-based Spirit also attributed its financial struggles to an &#8220;intense competitive battle&#8221; for price-sensitive leisure travelers, as well as an oversupply of airline seats in the domestic market.
&#8220;You can think [sic] Biden and his FTC crew for this. Way to go Joe!&#8221; a social media user posted.
Precedent shows that a deal with JetBlue wouldn&#8217;t have been a safety net for Spirit as most major airline mergers lead to job losses, regardless of whether the target is a distressed asset.
See Also: <a href="https://www.benzinga.com/markets/equities/24/10/41178053/spirit-airlines-engages-in-bankruptcy-talks-amid-financial-struggles-report">Spirit Airlines Engages In Bankruptcy Talks Amid Financial Struggles</a>
The scale and impact can vary depending on several factors such as the size of the merger. Here are a few examples of job losses from major mergers:
<ul>
<li>American Airlines (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAL#NASDAQ">AAL</a>) and US Airways: After the 2013 merger, there were several thousand job losses. Estimates ranged from 1,500 to 3,000 positions cut. </li>
<li>United Airlines (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/UAL#NASDAQ">UAL</a>) and Continental Airlines: The 2010 merger resulted in the elimination of roughly 1,500 to 2,000 job losses. These cuts were primarily due to redundant corporate and administrative positions. </li>
<li>Delta Air Lines, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DAL#NYSE">DAL</a>) and Northwest Airlines: While the 2008 merger helped the combined airline grow, but also led to an estimated 2,000 to 3,000 job losses.</li>
</ul>
Airline mergers often lead to route and capacity optimization, reducing staffing needs in less profitable areas. Cost synergies, like lowering fuel and labor costs, can prompt additional cuts as well. Fleet consolidation may phase out older aircraft, affecting technical staff.
Union agreements and labor contracts might also lead to layoffs as the merged airline harmonizes pay and benefits across the workforce.
While not all mergers result in severe job losses, neither do bankruptcies. Jobs can sometimes be saved when a company files for Chapter 11, since the process allows a company to reorganize its debts and operations while continuing to operate, giving it a chance to become financially viable. 
During this process, the company may restructure contracts, renegotiate with creditors and streamline operations, which can help preserve jobs that would otherwise be lost in a complete liquidation. While layoffs may occur, Chapter 11 provides more opportunities for the business to recover and protect a portion of its workforce.
Spirit&#8217;s debt load hovers around $3.3 billion, per the Wall Street Journal.
Recent airline bankruptcies include Virgin America and Monarch Airlines, both in 2017; WOW Air in 2019; and LATAM Airlines Group SA (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/LTM#NYSE">LTM</a>) in 2020. LATAM emerged from bankruptcy in 2022 stronger and is now larger and leaner, <a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/10/41123208/latam-airlines-earnings-will-remain-higher-for-longer-says-bullish-analyst">according to Morgan Stanley analysts</a>.
What&#8217;s Next: It remains to be seen whether Spirit will follow through with bankruptcy. At last check Friday, Spirit stock is trading 26.28% lower at $1.66, according to data from <a href="https://www.benzinga.com/pro/">Benzinga Pro</a>.
The stock has lost more than 85% of its value in 2024. 
Now Read: 
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<li><a href="https://www.benzinga.com/news/24/10/41124443/whats-going-on-with-delta-united-and-spirit-airlines-shares-tuesday">What's Going On With Delta, United and Spirit Airlines Shares Tuesday?</a></li>
</ul>
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Spirit Airlines Bankruptcy Chatter Has Critics Blaming Biden: Here's What History Shows About Carrier Mergers

Contrary to its odd reputation, Wall Street delivered an upbeat performance in September. The S&amp;P 500 added 1.6%, the Dow Jones advanced 1.8%, the Nasdaq Composite gained 2.3% and the Russell 2000 ticked up 0.3% last month. The month can be easily marked by the first Fed rate cut in four years, ECB&#39;s second rate cut and Chinese stimulus.
<h3>U.S. Economy Grows Faster Than Expected In Q2</h3>
The U.S. economy grew at an annualized rate of 3% in the second quarter of the year, surpassing Wall Street&#39;s expectations. According to the Bureau of Economic Analysis&#39;s third estimate, this growth rate remained unchanged from the previous estimate.
Economists had estimated the reading to show an annualized growth of 2.9%. The second-quarter growth marks a significant improvement from the 1.4% annualized growth seen in the first quarter (read: <a href="https://www.zacks.com/stock/news/2342935/4-reasons-to-buy-small-cap-etfs-now?art_rec=funds-etfs-trending_topics_popular-ID07-txt-2342935" target="_blank">4 Reasons to Buy Small-Cap ETFs Now</a>).
<h3>Fed Rate Cut</h3>
The Federal Reserve kicked off the easing monetary era by slashing key interest rates by 50 bps to 4.75-5% after holding it at a 23-year high for 14 consecutive months since July 2023. This marked the first rate cut since 2020 to address slowing economic growth and showed greater confidence in the fact that inflation is moving sustainably toward the 2% target level.
<h3>Chinese Stimulus</h3>
On Sept. 24, 2024, China&#39;s central bank, the People&#39;s Bank of China (PBOC), announced a broad range of monetary stimulus measures aimed at boosting the world&#39;s second-largest economy. This move indicates growing concerns within Xi Jinping&#39;s administration over the nation&#39;s slowing growth and declining investor confidence.
<h3>ECB Rate Cut</h3>
European Central Bank (ECB) slashed rates for the second time in three months in September. The reduction, from 3.75% to 3.5%, came on the heels of slowing inflation. &nbsp;The bank also intends to bolster the region&#39;s sagging economy.
<h3>Best-Performing ETFs of September</h3>
Against this backdrop, below we highlight a few winning exchange-traded funds (ETFs) for the month of September.
<h3>China ETFs</h3>
Global X MSCI China Consumer Discretionary ETF (ARCA: CHIQ) &ndash; Up 35%
KraneShares Hang Seng TECH Index ETF (ARCA: KTEC) &ndash; Up 33.7%
China&#39;s stimulus efforts boosted global markets, with mainland stocks notching their biggest weekly win since 2008. Shares of Alibaba BABA, JD.com (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/jd#NASDAQ">JD</a>), and Meituan jumped as investors showed renewed interest in Chinese equities (read: <a href="https://www.zacks.com/stock/news/2341543/a-few-reasons-to-buy-china-etfs-now" target="_blank">A Few Reasons to Buy China ETFs Now</a>).
<h3>Technology ETFs</h3>
First Trust Dow Jones International Internet ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/fdni#NASDAQ">FDNI</a>) &ndash; Up 24%
EMQQ The Emerging Markets Internet ETF EMQQ &ndash; Up 16.7%
International tech stocks have been in fine fettle due to global monetary policy easing. Since low rates are beneficial for growth sectors like technology, such an environment bodes well for international Internet stocks and ETFs. In general, Chinese stimulus and a Fed rate cut have favored the broader emerging market investing (read: <a href="https://www.zacks.com/stock/news/2342725/emerging-market-etfs-roar-back-to-new-heights" target="_blank">Emerging Market ETFs Roar Back to New Heights</a>).
<h3>Natural Gas</h3>
United States Natural Gas Fund LP (ARCA: UNG) &ndash; Up 22.8%
The natural gas markets have rallied as traders worry that the refining and extraction of natural gas in the Gulf of Mexico could be hampered due to hurricanes. Total U.S. consumption of natural gas rose by 2.5% (1.7 Bcf/d) in the week ending Sept. 25, 2024 from the previous week, <a href="https://www.eia.gov/naturalgas/weekly/" target="_blank">according to data from S&amp;P Global Commodity Insights</a>.
<h3>Lithium</h3>
iShares Lithium Miners and Producers ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/ilit#NASDAQ">ILIT</a>) &ndash; Up 14.7%
Electric vehicle (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/ev#NYSE">EV</a>) stocks gained momentum this month on speculation of higher EV sales. Electric car sales in the United States are on track for a record quarter, <a href="https://insideevs.com/news/735231/ev-sales-q3-2024-tesla/" target="_blank">according to forecasts out Wednesday from Cox Automotive</a>, as quoted on insideevs.com. Lithium-ion batteries are the most common type of battery used in electric vehicles. This fact explains the rally in ILIT ETF.
<h3>Airlines</h3>
U.S. Global Jets ETF (ARCA: JETS) &ndash; Up 14.3%
Airlines stocks soared on strong demand, decelerating capacity and lower oil prices. The Airports Council International (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/aci#NYSE">ACI</a>) World projects that global passenger volume will reach 9.5 billion in 2024, which is 104% of the 2019 level and a 10% increase from 2023, <a href="https://aci.aero/2024/09/18/the-trusted-source-for-air-travel-demand-updates-2/#:~:text=The%20current%20projection%20for%202024,(YoY)%20growth%20from%202023." target="_blank">per Airport Council International</a>.
U.S. Global Jets ETF provides exposure to the global airline industry, including airline operators and manufacturers from all over the world, by tracking the U.S. Global Jets Index. The product holds 60 securities and charges 60 bps on an annual basis.
<a href="https://www.zacks.com/stock/news/2343606/best-performing-etf-areas-of-september?cid=CS-BENZ-FT-etf_news_and_commentary-2343606">To read this article on Zacks.com click here.</a>

Asia

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Markets

ETFs

BABA

First Trust Dow Jones International Internet ETF

FDNI

ILIT

KTEC

Best-Performing ETF Areas Of September

Melius Research analyst Karen Short initiates coverage on Albertsons Companies (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) with a Hold rating and announces Price Target of $19.

Initiation

Melius Research Initiates Coverage On Albertsons Companies with Hold Rating, Announces Price Target of $19

Kroger Extends Exchange Offers And Consent Solicitations For Albertsons Companies For Up To $7,441,608,000 Aggregate Principal Amount Of New Notes And Cash; Extends Expiration Date From Sept. 23 To Sept. 27

Kroger Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KR#NYSE">KR</a>) and Albertsons Companies, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) shares closed lower Tuesday after lawyers for the Federal Trade Commission (FTC) gave closing arguments in a hearing to temporarily block the proposed merger <a href="https://www.benzinga.com/government/24/09/40693260/kroger-albertsons-merger-in-ftc-crosshairs-customers-competitors-at-risk">between the two companies.&nbsp;</a>
The Details: The three-week-long U.S. District Court hearing ended on Tuesday. The FTC urged Judge Adrienne Nelson to issue a preliminary injunction to block the merger while its complaint goes before an in-house administrative law judge on Oct.1.
Read Next: <a href="https://www.benzinga.com/markets/cryptocurrency/24/09/40888466/what-happened-with-microstrategy-stock-today">What Happened With MicroStrategy Stock Today?</a>
The proposed $24.6 billion deal would be the largest supermarket merger in U.S. history, if it goes through. Kroger and Albertsons argue the merger would allow them to lower prices for consumers, boost union jobs and compete with retail giants like Walmart Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/WMT#NYSE">WMT</a>) and Amazon.com, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AMZN#NASDAQ">AMZN</a>).&nbsp;
According to a Reuters report, the FTC's chief trial counsel Susan Musser argued Tuesday that Kroger and Albertsons primarily compete with each other, rather than Amazon or Costco Wholesale Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/COST#NASDAQ">COST</a>), as well, and the merger would eliminate competition, leading to higher food prices for customers. 
"It's this local competition, in these local communities, that this merger will eliminate," Musser said.
KR, ACI Price Action: According to <a href="https://pro.benzinga.com/?gspk=YWRhbWVja2VydDUzMzY&amp;gsxid=zBMR4PKmcgBw">Benzinga Pro</a>, Kroger shares ended Tuesday's session 2.13% lower at $55.04 and Albertsons shares closed 1.75% lower at $18.54.&nbsp;
Read Also:
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<li><a href="https://www.benzinga.com/news/24/09/40887805/whats-going-on-with-tupperware-brands-stock">What&#8217;s Going On With Tupperware Brands Stock?</a></li>
</ul>
Photo: Shutterstock

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COST

Kroger, Albertsons Shares Dip After FTC Gives Closing Arguments In Hearing To Block Merger

The Kroger Co. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KR#NYSE">KR</a>) (the "Company" or "Kroger") announced today that it has extended the expiration date of the previously announced offers to exchange (the "Exchange Offers") any and all outstanding notes (the "ACI Notes") of Albertsons Companies, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) ("ACI"), New Albertsons, L.P., Safeway Inc., Albertson's LLC, Albertsons Safeway LLC and American Stores Company, LLC, as applicable, for up to $7,441,608,000 aggregate principal amount of new notes to be issued by the Company (the "Kroger Notes") and cash. Additionally, Kroger announced today that it has extended the expiration date for the related solicitations of consents (collectively, the "Consent Solicitations") to adopt certain proposed amendments (the "Proposed Amendments") to the indentures (collectively, the "ACI Indentures") governing the ACI Notes, solely with respect to the Unconsented Series (as defined in the Company's press release issued on September 11, 2024). The Company hereby extends such expiration date from 5:00 p.m. New York City time on September 17, 2024 to 5:00 p.m. New York City time on September 23, 2024 (as the same may be further extended, the "Expiration Date").

Kroger Has Extended The Expiration Date For Its Exchange Offers And Consent Solicitations Related To Albertsons Companies Notes Until September 23, 2024

Reported Earlier, Kroger Extends Deadline For Exchange Offers And Consent Solicitations On Albertsons Notes To September 17, 2024

Editor&#8217;s note: This story has been updated with a statement from Kroger. 
The Federal Trade Commission (FTC) has reached the halfway point in a trial where it is trying to convince an Oregon federal judge to grant an injunction that would prevent two of the largest grocers — The Kroger Co. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KR#NYSE">KR</a>) and Alberstons Companies, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) — from carrying out <a href="https://www.benzinga.com/news/large-cap/22/10/29266605/kroger-albertsons-finally-seal-the-rumored-merger-deal-see-highlights">a $25 billion merger</a>.
What Happened: According <a href="https://www.wsj.com/us-news/law/pivotal-week-ahead-in-kroger-albertsons-case-after-ftc-lands-early-blows-6df34e54?mod=hp_lead_pos11">to</a> the Wall Street Journal, the FTC retained expert witnesses to testify that groceries could get more expensive if Kroger and Albertsons combined.
Last week, the FTC attacked both companies' proposal to sell more than 500 stores to C&amp;S Wholesale Grocers to placate regulators.
FTC lawyers are focusing on the troubles that C&amp;S would have in implementing new brands, technology systems and supply chains in the stores it would acquire from Kroger&#8217;s and Albertsons.
C&amp;S could run some of the stores it acquires under their current names (i.e., Safeway in Colorado and Arizona). However, it would need to change the name of 286 stores and bring in new unknown brands to local shoppers.
C&amp;S estimated that sales at renamed stores could fall by as much as 22% because it would have to set up new customer loyalty programs and introduce new private-label brands.
Kroger said in a statement to Benzinga that it is merging with Albertsons &#8220;to bring lower prices to more customers, protect good-paying union grocery jobs, and to better compete with massive retailers Walmart, Costco and Amazon.&#8221;
In the event the merger is blocked, consumers will see higher grocery prices and &#8220;the larger, non-union retailers Walmart, Costco and Amazon will become even more powerful and unaccountable,&#8221; the spokesperson said. 
Read Also: <a href="https://www.benzinga.com/news/earnings/24/06/39411109/kroger-company-shares-take-off-after-q1-heres-why">Kroger Company Shares Take Off After Q1 &#8211; Here&#8217;s Why</a>
Why It Matters: The high-profile case comes as <a href="https://www.bls.gov/news.release/cpi.nr0.htm" target="_blank" rel="noreferrer noopener">data</a> shows consumers continue to grow frustrated over pricey groceries. In July, for example, there was a sharp <a href="https://www.benzinga.com/news/24/08/40404411/eggs-are-the-villain-in-july-inflation-data-grocery-prices-edge-higher-as-other-sectors-cool">5.5% increase in egg prices</a>, contributing to a 0.7% rise in the broader meats, poultry and fish category.
The FTC is also scrutinizing whether C&amp;S would run the stores long-term or is buying them to bolster its wholesale business, which lost its biggest grocery customer in 2019.
C&amp;S executives testified that the grocer has limited market coverage in the Rocky Mountain states and the southwest, but the $2.9 billion deal with Kroger and Albertsons would give C&amp;S 101 Albertsons-owned stores in Arizona and 91 in Colorado.&nbsp;
C&amp;S also said it is committed to becoming a major supermarket operator. The company's owner,&nbsp;Rick Cohen, is funding $500 million of the deal.
The FTC warned U.S. District Judge Adrienne Nelson said that Albertson&#8217;s 2015 acquisition of Albertsons resulted in Haggen, a small West Coast grocery chain, going bankrupt and closing 83 stores of 146 Albertsons stores it bought as a condition for the deal.
The FTC trial against the Kroger-Alberstons merger is taking place as Democratic presidential candidate Kamala Harris proposes a <a href="https://www.benzinga.com/news/24/08/40467624/harris-price-gouging-plan-faces-pushback-from-grocers-hurting-from-the-same-inflationary-pressure-as">price-gouging plan</a> against grocers.
Price Action: Kroger gained 0.85% to $53.66 into Tuesday&#8217;s mid-morning trading. Albertsons dipped 0.61% to $19.50.
Read Now:
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<li><a href="https://www.benzinga.com/markets/equities/23/09/34361352/kroger-and-albertsons-seal-the-deal-a-1-9b-sale-to-change-the-grocery-game">Kroger And Albertsons Seal The Deal: A $1.9B Sale To Change The Grocery Game</a></li>
</ul>
Image: Shutterstock

Government

Kroger, Albertsons Merger In FTC Crosshairs: Customers, Competitors At Risk (UPDATED)

Kenvue Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KVUE#NYSE">KVUE</a>), the maker of Tylenol, has reportedly defended itself against a lawsuit in which consumers claimed being misled into overpaying for &#8220;Rapid Release&#8221; gelcaps, arguing that these gelcaps did not relieve pain any faster than less expensive Tylenol tablets.
The drug is used&nbsp;to treat mild to moderate <a target="_blank" href="https://www.benzinga.com/news/23/12/36321800/judge-bars-testimony-linking-kenvues-pain-killer-tylenol-to-autism-in-pregnancy" rel="noreferrer noopener">pain and to reduce fever</a>.
The lawsuit hinged on a 2018 study indicating that the gelcaps took slightly longer to dissolve—3.94 minutes compared to 3.56 minutes for regular tablets.
Also Read: <a target="_blank" href="https://www.benzinga.com/news/earnings/24/08/40192182/listerine-maker-kenvues-stock-soars-on-strong-q2-sales-from-its-essential-health-unit-reaffirms-ann" rel="noreferrer noopener">Listerine-Maker Kenvue&#8217;s Stock Soars On Strong Q2 Sales From Its Essential Health Unit, Reaffirms Annual Guidance</a>.
Citing a ruling issued on Tuesday, Reuters noted that U.S. District Judge Andrew Carter in Manhattan sided with Kenvue, determining that the consumers&#8217; claims were preempted by the federal Food, Drug, &amp; Cosmetic Act (FDCA).
Judge Carter emphasized that ignoring the FDA&#8217;s labeling regulations for &#8220;immediate release&#8221; acetaminophen products would be illogical because the agency did not use the term &#8220;rapid release.&#8221;
The judge further noted that similar rulings have been made in other cases, such as those against grocer Albertsons Companies, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) and pharmacy chain Rite Aid Corp (OTC:<a class="ticker" href="https://www.benzinga.com/stock/RADCQ#OTC">RADCQ</a>).
Carter argued that to disregard the FDA&#8217;s regulation of acetaminophen dissolution rates on the basis of marketing or pricing strategies would undermine the FDCA&#8217;s express preemption clause.
This decision reflects a consistent judicial approach to interpreting FDA guidelines, reinforcing the agency&#8217;s authority to regulate drug labeling and marketing.
Kenvue was formerly a part of Johnson &amp; Johnson (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/JNJ#NYSE">JNJ</a>) before becoming an independent <a target="_blank" href="https://www.benzinga.com/general/biotech/23/08/34117196/johnson-johnson-reveals-updated-2023-projections-after-finalizing-biggest-shake-up-in-135-years" rel="noreferrer noopener">company in August 2023</a>.
Price Action: KVUE stock is up 0.18% at $21.79 at last check Friday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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Photo Courtesy: FOOD PHOTO STOCK / Shutterstock.com

Health Care

Media

General

KVUE

RADCQ

Johnson & Johnson-Spin Off Kenvue Wins Lawsuit Over Pain Killer Tylenol 'Rapid Release' Gelcaps

The Kroger Co.&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KR#NYSE">KR</a>) filed a motion for a preliminary injunction in the U.S. District Court, Southern District of Ohio, against the FTC&#8217;s administrative proceeding challenging its merger with Albertsons Companies, Inc.&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>).
The company argues that the FTC&#8217;s use of both its administrative tribunal and a <a target="_blank" href="https://www.benzinga.com/pressreleases/24/08/n40447542/kroger-files-motion-to-enjoin-the-ftcs-administrative-merger-challenge" rel="noreferrer noopener">federal court action violates Constitutional protections.</a>
Kroger&#8217;s motion states that the FTC&#8217;s proceeding violates the Constitution by breaching Article II, as its judge isn&#8217;t removable by the President, and Article III, by resolving private contract rights through the Executive Branch instead of the Judicial Branch.
The company claims the FTC is unfairly splitting its challenge into two tribunals for multiple chances to litigate. While pushing Kroger into an unconstitutional administrative process, the FTC also seeks to block the merger in federal court.
Evidentiary hearings in the federal court are set to begin on August 26 in Oregon.
Rodney McMullen, Kroger Chairman and CEO, said, &#8220;The merger between Kroger and Albertson&#8217;s is squarely focused on ensuring we bring customers lower prices starting day one while securing the future of good-paying union jobs.&#8221;
&#8220;We stand prepared to defend this merger in the upcoming trial in federal court – the appropriate venue for this matter to be heard – and we are asking the Court to halt what amounts to an unlawful proceeding before the FTC&#8217;s own in-house tribunal.&#8221;
The FTC&#8217;s lawsuit filed in February argues that Kroger&#8217;s merger with Albertsons would lead to higher prices for millions of Americans and put pressure on the labor market for unionized grocery workers, reported Reuters.
The $25 billion supermarket merger, announced in October 2022, aimed to create a grocery giant with over 4,000 stores. However, it has faced antitrust lawsuits, with Washington State&#8217;s attorney general leading the challenge <a target="_blank" href="https://www.benzinga.com/markets/equities/24/08/40412956/whats-going-on-with-kroger-stock-premarket-friday" rel="noreferrer noopener">over concerns about rising grocery prices</a>.
The proposed merger was paused last month, awaiting a Colorado District Court ruling on a lawsuit aimed at blocking the deal.
Last week, Kroger disclosed that it has begun private exchange offers for eligible holders to swap any outstanding notes issued by&nbsp;Albertsons and its subsidiaries for&nbsp;up to $7.44 billion in new Kroger notes and cash.
Investors can gain exposure to the stock via&nbsp;Invesco Food &amp; Beverage ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PBJ#NYSE">PBJ</a>) and&nbsp;Tidal ETF Trust Newday Ocean Health ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AHOY#NYSE">AHOY</a>).
Price Action: KR shares are down 0.25% at $52.63 premarket at the last check Tuesday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo via Shutterstock
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AHOY

Kroger Takes Legal Action Against FTC's Merger Review, Claims Proceeding As 'Unconstitutional'

Kroger Sues U.S. Federal Trade Commission To Prevent In-House Review Of Albertsons Deal

The Kroger Co.&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KR#NYSE">KR</a>) disclosed on Thursday that it has begun private exchange offers for eligible holders to swap any outstanding notes issued by Albertsons Companies, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) and its subsidiaries for <a target="_blank" href="https://www.benzinga.com/pressreleases/24/08/n40406669/kroger-announces-commencement-of-exchange-offers-and-consent-solicitations-for-albertsons-companie" rel="noreferrer noopener">up to $7.44 billion in new Kroger notes and cash</a>.
Apart from this, the company plans to cut grocery prices by $1 billion following its $25 billion merger, reported Reuters.
The supermarket merger, announced in October 2022, aimed to create a grocery giant with over 4,000 stores. However, it has faced antitrust lawsuits, with Washington State&#8217;s attorney general leading the challenge over concerns about rising grocery prices, the report added.
The proposed merger was paused last month, awaiting a Colorado District Court ruling on a lawsuit aimed at blocking the deal.
Read: <a target="_blank" href="https://www.benzinga.com/news/earnings/24/07/39911519/merger-bound-albertsons-companies-q1-sales-beats-estimate-with-pharmacy-and-digital-sales-boost" rel="noreferrer noopener">Merger-Bound Albertsons Companies&#8217; Q1 Sales Beats Estimate With Pharmacy And Digital Sales Boost</a>
The trial is scheduled to start on September 30, according to State Attorney General Phil Weiser.
In July, Kroger revealed the comprehensive list of stores, distribution centers, and plants it plans to divest to gain regulatory approval for its <a target="_blank" href="https://www.benzinga.com/markets/equities/24/07/39707233/kroger-reveals-divestiture-plan-for-albertsons-merger-approval-report" rel="noreferrer noopener">proposed merger with&nbsp;Albertsons</a>.
Kroger had previously pledged to cut grocery prices by $500 million at Albertsons locations.
The divestiture package, initially consisting of 413 stores, has been increased <a target="_blank" href="https://www.benzinga.com/markets/equities/24/01/36640755/kroger-albertsons-25b-merger-plan-hits-a-snag-anticipates-completion-in-first-half-of-2024" rel="noreferrer noopener">following the Federal Trade Commission&#8217;s (FTC) intervention.</a>
In June, Kroger reported first-quarter adjusted EPS of $1.43, surpassing analyst <a target="_blank" href="https://www.benzinga.com/news/earnings/24/06/39411109/kroger-company-shares-take-off-after-q1-heres-why" rel="noreferrer noopener">expectations of $1.34 per share</a>.
Investors can gain exposure to the stock via&nbsp;Invesco Food &amp; Beverage ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PBJ#NYSE">PBJ</a>) and Tidal ETF Trust Newday Ocean Health ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AHOY#NYSE">AHOY</a>).
Price Action: KR shares are up 0.98% at $53.41 premarket at the last check Friday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo via Shutterstock
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</ul>

What's Going On With Kroger Stock Premarket Friday?

For those shopping for groceries, a modest 0.1% increase in the food-at-home index might seem manageable, but specific items <a href="https://www.benzinga.com/economics/macro-economic-events/24/07/39728268/inflation-slows-more-expected-to-3-in-june-heightens-expectations-for-rate-cuts-t">are pricier than others</a>.
For example, <a href="https://www.bls.gov/news.release/cpi.nr0.htm">data</a> shows consumers faced a sharp 5.5% increase in egg prices, contributing to a 0.7% rise in the broader meats, poultry, fish and eggs category. 
This spike is particularly burdensome for families relying on eggs as a staple protein source, pushing them to either absorb the cost or seek alternatives.
For July, the average price per dozen large Grade A eggs in U.S. cities was $3.08. This trend highlights the marked, ongoing volatility in egg prices due to fluctuating supply and demand conditions.
Read Also: <a href="https://www.benzinga.com/markets/equities/24/08/40399595/bill-ackman-cuts-chipotle-stake-right-before-stock-drop-did-billionaire-see-what-the-market-coul">Bill Ackman Cuts Chipotle Stake Right Before Stock Drop: Did Billionaire See What The Market Couldn&#8217;t?</a>
Here&#8217;s a closer look at the other food groups:
<ul>
<li>Fruits and Vegetables: A 0.8% increase in this category adds pressure on consumers aiming to maintain a healthy diet. This rise might lead some households to reduce purchases of fresh produce, impacting nutritional choices.</li>
<li>Nonalcoholic Beverages: The 0.5% rise in this index suggests that even everyday items like coffee, juice and soda are subtly increasing overall grocery bills.</li>
</ul>
On the flip side, declines in certain categories offered some relief:
<ul>
<li>Cereals and Bakery Products: A 0.5% decrease here could help offset rising costs elsewhere, providing some respite for consumers who rely on these items as dietary staples.</li>
<li>Dairy Products: With a slight 0.2% decline, dairy costs are easing, which may encourage continued consumption of milk, cheese, and yogurt, key sources of calcium and protein.</li>
</ul>
Read Also: <a href="https://www.benzinga.com/top-stories/24/08/40396716/starbucks-new-ceo-brian-niccol-boosts-company-valuation-by-over-15b-in-one-day-whats-his-net-worth">New Starbucks CEO Brian Niccol Boosts Company Valuation By Over $15B In One Day: What&#8217;s His Net Worth?</a>
<h2 class="wp-block-heading">Dining Out</h2>
<ul>
<li>The food-away-from-home category saw a 0.2% increase in July; though smaller than in previous months, still reflects ongoing inflationary pressure on dining out. </li>
<li>Limited-service meals (e.g., fast food) saw a 0.3% increase, which could push consumers to reduce eating out or opt for cheaper menu items. </li>
<li>Full-service meals rose by 0.1%, signaling that even sit-down dining is becoming less affordable.</li>
</ul>
Read Also: <a href="https://www.benzinga.com/markets/equities/24/08/40401329/russell-2000-set-for-strongest-session-in-a-month-as-us-economy-defies-recession-fears-small-cap">Russell 2000 Set For Strongest Session In A Month As US Economy Defies Recession Fears: Small Cap Movers On Thursday</a>
<h2 class="wp-block-heading">Stocks To Watch</h2>
<ul>
<li>Kroger Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KR#NYSE">KR</a>), one of the largest grocery chains in the U.S., could benefit from ongoing consumer spending on groceries despite price fluctuations. The company&#8217;s scale and diversified product offerings help it manage supply chain costs and offer competitive pricing.</li>
<li>Costco Wholesale Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/COST#NASDAQ">COST</a>) could attract consumers looking to save money amid rising grocery prices. The company&#8217;s focus on value and bulk items aligns well with current consumer behavior trends.</li>
<li>Target Corp (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TGT#NYSE">TGT</a>) could also benefit from increased grocery sales. Its efforts to enhance the grocery shopping experience and competitive pricing strategies might position it well in a challenging environment.</li>
<li>Albertsons Companies Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ACI#NYSE">ACI</a>) is well-positioned to capitalize on steady grocery spending. Its focus on various grocery formats and geographic reach might support its performance.</li>
<li>Sprouts Farmers Market Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SFM#NASDAQ">SFM</a>), focusing on fresh and organic offerings, might appeal to consumers willing to pay a premium for higher-quality products.</li>
</ul>
U.S. markets soared on Thursday following the release of stronger-than-expected <a href="https://www.benzinga.com/economics/macro-economic-events/24/08/40393687/retail-sales-soar-in-july-weekly-jobless-claims-undercut-expectations-traders-lea">economic data</a>, which pointed to a robust consumer sector and a resilient labor market, fueling optimism about the nation's economic outlook.
According to preliminary estimates released Thursday, U.S. retail sales jumped by 1% month-over-month in July, sharply rebounding from June's stagnation and far exceeding the anticipated 0.3% growth. 
On a year-over-year basis, retail sales increased by 2.7%, accelerating from a downwardly revised 2% gain in June. Excluding motor vehicles and parts, retail sales still grew by 0.4%, outpacing economist expectations of a modest 0.1% rise.
Meanwhile, July food price data highlighted ongoing challenges for consumers managing household budgets. The overall food index rose by 0.2%, continuing a trend of rising costs.
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Image by <a href="https://pixabay.com/users/kc0uvb-5658981/?utm_source=link-attribution&amp;utm_medium=referral&amp;utm_campaign=image&amp;utm_content=2411667">Jeremy Smith</a> from <a href="https://pixabay.com//?utm_source=link-attribution&amp;utm_medium=referral&amp;utm_campaign=image&amp;utm_content=2411667">Pixabay</a>

Eggs Are The Villain In July Inflation Data: Grocery Prices Edge Higher As Other Sectors Cool

Kroger Doubles Price Cuts For Albertsons Stores To $1 Billion In Effort To Secure Approval For $24.6B Merger

Catalyst Watch: Tesla's Robotaxi reveal, AI events for Nvidia, AMD, and HP Enterprise

Kroger's (KR) $25 billion merger with Albertsons (ACI) is in limbo as federal regulators and states push to block the deal over concerns of higher prices and reduced competition. As the legal battle heats up, the company is fighting to prove the merger's benefits for shoppers. In this article, we'll explore whether KR is a buy or sell amid this high-stakes merger drama. Keep reading… The Kroger Co. (<a href="https://stocknews.com/stock/KR/">KR</a>), one of the largest grocery retailers in the U.S., is currently <a href="https://www.ftc.gov/news-events/news/press-releases/2024/02/ftc-challenges-krogers-acquisition-albertsons">facing legal challenges</a> as it moves forward with its $25 billion merger with Albertsons Companies, Inc. (<a href="https://stocknews.com/stock/ACI/">ACI</a>). This high-profile merger, announced in October 2022, is now under scrutiny in a federal hearing in Portland, Oregon, as the Federal Trade Commission (FTC) and several states push back with an antitrust lawsuit.
The FTC argues that the merger could stifle competition, potentially leading to higher prices for everyday essentials like groceries, along with reduced product quality and fewer options for consumers. Further, FTC's Bureau of Competition Director Henry Liu added, "Essential grocery store workers would also suffer under this deal, facing the threat of their wages dwindling, benefits diminishing, and their working conditions deteriorating."
This sentiment is echoed by many critics, including union supporters, who recently <a href="https://www.9news.com/article/news/local/grocery-store-unions-against-kroger-albertsons-merger/73-43d3956c-0e03-48fb-ba15-67ccff006d92">rallied</a> against the merger in Denver. Grocery workers and farmers expressed concerns that the deal would only benefit corporations, leaving workers and the supply chain at risk. Some worry that a merger of this scale could result in devastating consequences for employees, farmers, and consumers, who might face higher costs at the checkout line.
On the other hand, KR and ACI maintain that the merger will help them better compete with retail giants like Walmart Inc. (<a href="https://stocknews.com/stock/WMT/">WMT</a>), Costco Wholesale Corporation (<a href="https://stocknews.com/stock/COST/">COST</a>), and Amazon.com, Inc. (<a href="https://stocknews.com/stock/AMZN/">AMZN</a>), ultimately benefiting consumers through lower prices.
While the courtroom drama continues, some industry analysts raise another critical point. They argue that the time KR has spent pursuing this merger could have been better spent improving its competitiveness in other ways. According to <a href="https://www.grocerydive.com/news/kroger-albertsons-merger-ftc-trial-analysis-grocery-superrmarket/726195/">Halliday</a>, if the merger is blocked, the company might face a strategic dilemma, as it has relied heavily on acquisitions to fuel its growth.
Despite the challenges, shares of KR have gained 10.1% over the past month and 24.4% over the past year, closing the last trading session at $55.89. So, as the merger battle continues to unfold, investors must weigh the potential long-term growth opportunities against the immediate legal and operational risks Kroger faces.
Here are the financial aspects of KR that could influence its price performance in the near term:
Strong Financials
KR's sales for the fiscal second quarter (ended August 17, 2024) remained nearly flat year-over-year at $33.91 billion, while its identical sales without fuel increased 1.2% year-over-year. Its operating profit amounted to $815 million compared to a year-ago loss of $479 million.
Similarly, the company's net earnings attributable to KR amounted to $466 million or $0.64 per common share versus a net loss of $180 million or $0.25 per share, respectively, in the same period last year. On an adjusted basis, Kroger's performance was even stronger. The adjusted FIFO operating profit amounted to $984 million, and adjusted <a href="https://www.investopedia.com/terms/e/eps.asp">EPS</a> stood at $0.93.
Looking ahead to 2024, Kroger remains cautiously optimistic, with identical sales without fuel anticipated to grow between 0.75% and 1.75%. Adjusted FIFO operating profit is projected to be between $4.6 billion and $4.8 billion, while adjusted net earnings per diluted share are expected to range from $4.30 to $4.50.
These projections underscore the company's confidence in its strategic direction and operational efficiency, emphasizing its focus on sustainable growth and operational excellence.
Mixed Analyst Estimates
Analysts expect KR's EPS to increase 2.9% year-over-year to $0.98 for the third quarter ending October 2024. Also, its revenue for the current quarter is expected to grow marginally from the prior year's value to $34.22 billion.
However, KR's revenue and EPS for the current year (ending January 2025) are expected to decline 0.6% and 6.7% year-over-year to $149.16 billion and $4.44, respectively.
Nonetheless, for the fiscal year ending January 2026, KR's revenue is expected to increase 1.9% year-over-year to $152.02 billion. The company is estimated to post an earnings per share of $4.56 next year, indicating a 2.7% improvement from the prior year.
Discounted Valuation
In terms of forward non-GAAP P/E, KR is trading at 12.59x, 28.5% lower than the industry average of 17.61x. Likewise, its forward EV/Sales multiple of 0.38 is 78% lower than the industry average of 1.74x. In addition, the stock's forward EV/EBITDA of 7.28x is 33.2% lower than the 10.90x industry average. Also, its forward Price/Sales multiple of 0.27 compares to the industry average of 1.37.
High Profitability
KR's trailing-12-month ROCE of 23.97% is 129.1% higher than the 10.46% industry average. The stock's 9.71% trailing-12-month ROTC is 41.5% above the 6.86% industry average. Further, its trailing-12-month asset turnover ratio of 2.96x compares to the industry average of 0.84x.
POWR Ratings Exhibit Solid Prospects
KR's strong fundamentals are reflected in its <a href="https://stocknews.com/powr-ratings/">POWR Ratings</a>. The stock has an overall rating of B, translating to a Strong Buy in our proprietary rating system. The POWR Ratings are calculated by accounting for 118 distinct factors, with each factor weighted to an optimal degree.
Our proprietary rating system also evaluates each stock based on eight distinct categories. KR boasts a B grade for Value, mirroring its discounted valuation. It also earns a B for Quality, reflecting its higher profitability metrics compared to industry standards.
Within the A-rated <a href="https://stocknews.com/category/grocery-big-box-retailers/">Grocery/Big Box Retailers</a> industry, KR is ranked #26 out of the 37 stocks.
Beyond what we've stated above, we have also rated the stock for Growth, Momentum, Stability, and Sentiment. Get all KR ratings <a href="https://stocknews.com/stock/KR/">here</a>.
Bottom Line
Despite the legal challenges of its proposed merger, KR's financials remain robust. The company continues to demonstrate strong profitability, backed by steady operational growth and healthy margins. Moreover, its resilient business model has consistently delivered sustainable returns, even in challenging economic conditions.
On September 19, the company declared a quarterly dividend of <a href="https://ir.kroger.com/news/news-details/2024/Krogers-Board-of-Directors-Declares-Quarterly-Dividend-6c2bd6fe2/default.aspx">32 cents per share</a>, continuing its 16-year streak of dividend growth. The current dividend of $1.28 per share yields 2.29%, above its four-year average of 2.01%. Also, its payouts have grown at impressive CAGRs of 16.6% and 15.5% over the past three and five years, respectively.
Further, the stock is currently trading at a discounted valuation, which makes it an attractive option for investors seeking value in the grocery retail sector. While the merger's outcome remains uncertain, KR's long-term growth potential and ability to compete with industry giants make it a strong buy for investors seeking upside amid uncertainty.
How Does The Kroger Co. (KR) Stack Up Against Its Peers?
While KR has an overall grade of B, equating to a Buy rating, you may also check out these other stocks within the <a href="https://stocknews.com/category/grocery-big-box-retailers/">Grocery/Big Box Retailers</a> industry: Ryohin Keikaku Co., Ltd. (<a href="https://stocknews.com/stock/RYKKY/">RYKKY</a>), DFI Retail Group Holdings Limited (<a href="https://stocknews.com/stock/DFIHY/">DFIHY</a>), and Marks and Spencer Group plc (<a href="https://stocknews.com/stock/MAKSY/">MAKSY</a>), all of which carry A (Strong Buy) ratings. To explore more Grocery/Big Box Retailers stocks, <a href="https://stocknews.com/category/grocery-big-box-retailers/">click here</a>. 
What To Do Next?
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KR shares were trading at $55.78 per share on Monday afternoon, down $0.11 (-0.20%). Year-to-date, KR has gained 24.21%, versus a 21.15% rise in the benchmark S&amp;P 500 index during the same period.
<hr><div style="clear:both;"></div> <h2>About the Author: Shweta Kumari</h2> <img src='https:/wp-content/uploads/2022/03/Shweta-Kumari_Image-2.jpg' style="float:left; padding:5px;width:125px;">Shweta's profound interest in financial research and quantitative analysis led her to pursue a career as an investment analyst. She uses her knowledge to help retail investors make educated investment decisions.<a href="https://stocknews.com/authors/?author=shweta-kumari">More...</a>The post <a href=https://stocknews.com/news/kr-rykky-dfihy-maksy-aci-is-kroger-a-buy-as-its-mega-merger-faces-legal/>Is Kroger a Buy as Its Mega Merger Faces Legal Challenges?</a> appeared first on <a href=https://stocknews.com/>StockNews.com</a>

Is Kroger a Buy as Its Mega Merger Faces Legal Challenges?

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