Earnings season is winding down, with most companies already having reported their quarterly results. But there are still some companies left to report, and The Kroger Co. (NYSE:KR) is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarter reports is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed, knee-jerk reaction to news that turns out to be exactly the wrong move.
The grocery business is a tough, low-margin industry that's hard to earn a big profit in. Over the years, The Kroger Co. (NYSE:KR) has grown steadily despite increasing headwinds from higher food prices and competition from big-box retailers and organic specialists. Let's take an early look at what's been happening with Kroger over the past quarter and what we're likely to see in its quarterly report on Thursday.
Stats on Kroger
|Analyst EPS Estimate||$0.70|
|Change From Year-Ago EPS||40%|
|Revenue Estimate||$24.01 billion|
|Change From Year-Ago Revenue||12.2%|
|Earnings Beats in Past 4 Quarters||4|
Will Kroger feed investors a good quarter? Analysts have been rock-solid on their calls for The Kroger Co. (NYSE:KR)'s earnings over the past few months, keeping their estimates unchanged for the just-ended quarter and raising them by a single penny per share for the full 2014 fiscal year. The stock has performed nicely, rising 10% since early December.
Traditional grocery chains have generally struggled over the past year. Competition from Wal-Mart Stores, Inc. (NYSE:WMT) and Target Corporation (NYSE:TGT) has put pressure on major chains that have already been facing the challenge of dealing with razor-thin margins. That pressure finally forced SUPERVALU INC. (NYSE:SVU) to accept a deal to sell some of its top supermarket chains to private equity firm Cerberus.