Kroger Cuts FY26 Same-Store Sales Outlook to 0.2%-0.8% as Q2 EPS Beats
KR is trading near its 52-week low of $54.15 (2.1% above the low).
Summary
Kroger cut its full-year same-store sales growth outlook to 0.2%-0.8% from 1%-2%, while Q2 adjusted EPS of $1.09 beat last year's $1.04. Profit and cash flow guidance were reaffirmed, and the company bought back $1.0 billion in shares during the quarter.
Key Events · Earnings and Guidance · KR
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FY26 Same-Store Sales Guidance Cut
Identical sales without fuel guidance lowered to 0.2%-0.8% growth from 1%-2%, including an approximately 140 basis point headwind from the Inflation Reduction Act.
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Q2 Adjusted EPS Beats Year-Ago
Adjusted EPS of $1.09 vs $1.04 a year ago; GAAP EPS of $1.05 vs $0.91. Total sales were $34.6 billion, up from $33.9 billion.
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Profit and Cash Flow Guidance Reaffirmed
Full-year adjusted EPS of $5.10-$5.30, FIFO operating profit of $5.0B-$5.2B, free cash flow of $2.7B-$2.9B, and capex of $3.8B-$4.0B all reaffirmed.
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$1.0B Share Repurchase in Q2
Kroger repurchased $1.0 billion in shares during Q2 and $1.2 billion year-to-date under its $2 billion authorization; approximately $800 million remains.
Analysis · KR · Trade & Services
Kroger lowered its full-year identical sales guidance to 0.2%-0.8% growth, down from 1%-2%, citing a 140 basis point headwind from the Inflation Reduction Act and a softer macro environment. The cut lands while the stock trades near its 52-week low, amplifying concern about demand. Offsetting that, Q2 adjusted EPS of $1.09 beat the year-ago $1.04, and management reaffirmed profit, free cash flow, and capex targets — signaling the sales softness is not flowing through to earnings. The company also repurchased $1.0 billion in shares during the quarter and raised its dividend 11%, using its balance sheet to support the stock.
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At the time of this filing, KR was trading at $55.30 on NYSE in the Trade & Services sector, with a market capitalization of approximately $34.9B. The 52-week trading range was $54.15 to $76.58. This filing was assessed with negative market sentiment and an importance score of 7 out of 10.