Daily Stock Analysis: The Kroger Co

The portfolio of stocks I started building on September 8, at a one stock per week pace for the next year, is named Vista. I will select its eighteenth stock this weekend. Vista is the sixth portfolio I've built (at a one dividend dog per-week pace) since 2014. Six portfolios = VI for Vista!

Vista is planned to Look Ahead for Outstanding, Proven, Dividend Winners. (Like Aristocrats)

Today we look at a large-cap grocery store company named The Kroger Co. Its trading ticker symbol is KR. This is my first report on The Kroger Co for Vista. 

Kroger is the leading American grocer, with 2,757 supermarkets operating under several banners throughout the country as of the end of fiscal 2019. 

Source: Unsplash 

Around 82% of stores have pharmacies, while over half also sell fuel. The company also operated more than 300 fine jewelry stores at the end of fiscal 2019. 

Kroger features a leading private-label offering and manufactures around a third of its own-brand units (and 42% of its grocery own-label assortment) itself, in 35 food production plants nationwide. 

Kroger is a top-two grocer in 90% of its 35 major markets (as of late 2019, according to Planet Retail and Edge Retail Insight data cited by the company). Virtually all of Kroger's sales come from the United States.

To support its online retail store, The Kroger Co. has a strategic partnership with Ocado Solutions to construct three new customer fulfillment centers in the Great Lakes, Pacific Northwest, and West regions. 

The company was founded in 1883 and is based in Cincinnati, Ohio.

I use three key data points to gauge dividend equities or funds like The Kroger Co:

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether a company has made, is making, and will make money. 

KR Price

Kroger's price per share closed at $31.71 yesterday. A year ago its price was $28.30. Price rose 12% last year.

If Kroger stock trades in the range of $26 to $36 this next year, its recent $31.71 price might rise by $2.29 to reach $34.00 by January 12, 2022. 

KR Dividends

Kroger's most recently declared quarterly dividend was $0.18 paid December 1st. Dividends are estimated to total $0.72 per share annually and yield 2.27% at yesterday's $31.71 closing price.

KR Gains?

Adding the $0.72 annual Kroger anticipated dividend to my $2.29 optimistic price upside shows a $3.01 potential gross gain, per share, to be reduced by any costs to trade the shares.  

Put little over $1,000.00 today in Kroger at $31.71 per share and we'd buy 32 shares of KR stock.

A $10 broker fee (if any) paid half at purchase and half at sale could cost us about $0.31 per share.

Subtract that maybe $0.31 brokerage cost from my estimated  $3.01 gross gain per share results in a net gain of $2.70 X 32 shares = $86.40 for an 8.6% net gain on a $1,014.72 investment.

So it goes that The Kroger Co shows a possible  8.6% net gain including a 2.27% dividend yield. It could be more, it could be less.   

All of the estimates above are speculation based on the past history of The Kroger Co. Only time and money invested in this stock will determine its worth.