The Kroger Co. (KR)
Quantitative Summary
DeterministicKR trades at 40.4x earnings, roughly in line with its sector average of 32.6x. Financial health is average: Piotroski 6/9, Altman Z 4.4. DCF fair value of $104 implies 54% upside from current prices based on model assumptions.
Generated deterministically from quant metrics and financial statements. Not a recommendation.
Algorithmic Teardown
AI-GeneratedThe fundamental economics of The Kroger Co. present a distinct divergence between operational stability and capital efficiency, characterized by a negative ROIC-WACC spread of -2.6% that suggests the firm is currently destroying value relative to its cost of capital despite maintaining a Piotroski F-Score of 6/9 indicating solid financial strength. While the Altman Z-Score of 4.4 signals low bankruptcy risk and the Beneish M-Score of -3.11 points to clean earnings without manipulation, profitability is heavily reliant on high leverage rather than margin expansion or asset turnover, as evidenced by a razor-thin net margin of 0.7% against a gross margin of 23.3%. This structural weakness in capital allocation contrasts with the company's defensive sector positioning and steady revenue growth trajectory.
Valuation metrics reveal significant market dislocation, where the current P/E ratio of 44.1x trades at a steep discount to its five-year historical average of 125.6x yet remains elevated compared to the broader consumer defensive sector average of 34.2x. This compression relative to history suggests potential oversold conditions, which aligns with a DCF model implying substantial upside if future cash flows materialize at an annualized growth rate near the projected 9.6%. The market appears to be pricing in conservative expectations that may not fully account for the inherent safety margin provided by the company's strong balance sheet metrics and its positive value factor tilt of 0.285 within the Fama-French framework.
Risk assessment highlights a unique profile where the stock exhibits a robust annualized Fama-French alpha of 7.44%, suggesting it has historically outperformed traditional risk factors, while insider activity remains neutral with zero net flow over the last ninety days. The combination of a negative spread on capital returns and a valuation that sits below historical norms creates a complex scenario where the stock offers potential mean reversion based on DCF fair value assumptions but carries ongoing operational pressure to improve its return profile above the cost of funds without relying solely on leverage or volume growth.
Generated by LLM from quantitative data inputs. May contain inaccuracies. Not investment advice.
DCF Sandbox
Interactive5-year two-stage DCF. Terminal growth 3%. Default sliders match the pre-computed base case. Drag to explore scenarios. Not investment advice.
The growth rate the market implicitly expects over the next 10 years to justify today's price. Compare with historical growth of 0% YoY revenue.
Sensitivity Matrix
| TG ↓ / WACC → | 6% | 7.2% | 9.2% |
|---|---|---|---|
| 2% | $114 | $85 | $58 |
| 3% | $150 | $104 | $67 |
| 4% | $223 | $136 | $79 |
Center = base case. Green = >10% upside, Red = >10% downside vs $61.56.
Pre-computed DCF: WACC=7.2%, terminal growth 3%. Fair value $104 (+53.6%). Not investment advice.
Valuation Context
Currently trading 65% below its 5-year average P/E of 125.1x.
Price Chart with Moving Averages
Technical Setup
AI GeneratedThe current technical configuration for The Kroger Co. presents a complex landscape regarding institutional positioning, highlighted by the intersection of moving average dynamics and price action relative to recent trading levels. While specific crossover events are not detailed in the provided dataset, the proximity of the stock to its $67.25 mark suggests that larger market participants may be engaged in active accumulation or distribution phases rather than passive holding. In defensive sectors like consumer staples, such price stability often correlates with institutions hedging against macroeconomic volatility while maintaining exposure to essential goods demand. The absence of extreme volume spikes indicates a lack of aggressive capitulation or panic selling, which typically signals that major holders are not yet forced out of their positions despite broader market fluctuations. Volume trends in this context usually serve as the primary indicator of institutional intent; steady trading activity around key support levels often implies patient capital waiting for favorable entry points, whereas sudden surges would suggest a shift in control from one group to another. Given KR's sector classification, large players frequently utilize such periods to rebalance portfolios without triggering significant price dislocations that could disrupt supply chain or operational strategies. The current setup does not definitively point toward an immediate directional breakout but rather reflects a consolidation phase where institutional behavior is characterized by caution and strategic positioning. Market observers might interpret this as a period where larger entities are reassessing valuations before committing to new long-term stances, leaving the ultimate direction dependent on upcoming fundamental developments or broader sector rotation trends.
Quant Health Deep Dive
Profitability & Value Creation
✅ Conservative payout — room for dividend increases.
Balance Sheet Health
Earnings Surprise History
EPS estimates vs actuals for the most recent reported quarters. Source: yfinance.
Dividend History
| Date | Amount | Change |
|---|---|---|
| 2026-05-15 | $0.3500 | 0.0% |
| 2026-02-13 | $0.3500 | 0.0% |
| 2025-11-14 | $0.3500 | 0.0% |
| 2025-08-15 | $0.3500 | +9.4% |
| 2025-05-15 | $0.3200 | 0.0% |
| 2025-02-14 | $0.3200 | 0.0% |
| 2024-11-15 | $0.3200 | 0.0% |
| 2024-08-15 | $0.3200 | +10.3% |
| 2024-05-14 | $0.2900 | 0.0% |
| 2024-02-14 | $0.2900 | 0.0% |
| 2023-11-14 | $0.2900 | 0.0% |
| 2023-08-14 | $0.2900 | +11.5% |
Dividend and split data from SEC filings and market data. Amounts are per share, not adjusted for splits. Source: yfinance.
Risk Profile
Sharpe = risk-adjusted return (higher is better). Max drawdown = largest peak-to-trough decline. 1,200+ trading days.
Underwater (Drawdown from Peak)
How far below the all-time high the price has been over time. Deeper = more pain for holders.
Rolling 60-Day Beta vs S&P 500 (VOO)
How the stock's sensitivity to market moves changes over time. β > 1 = more volatile than the market.
Fama-French 5-Factor Exposure
Academic factor model decomposition — what's really driving this stock's returns.
Fama-French 5-Factor Model. Data: Kenneth French Data Library. Regression over 3 years of daily returns.
Fundamentals
Passive Flow Attribution
ETF Draft EffectWhen investors buy or sell ETFs like XLP or VDC, the fund manager is mechanically forced to buy or sell KR shares regardless of The Kroger Co.'s individual fundamentals. We estimate $5.8B of passive capital is structurally linked to KR through 8 tracked ETFs. This substantial passive exposure means that ETF inflows and outflows — not company fundamentals — can dominate daily volume on this stock.
Passive exposure = Σ (ETF AUM × stock weight in ETF) across 8 tracked ETFs. Actual passive ownership is larger (includes mutual funds). Not investment advice.
ETF Contagion Visualizer
Simulate a price drop in The Kroger Co. to visualize passive redemption contagion across ETFs and collateral stocks.
If The Kroger Co. (KR) experiences a significant drawdown, ETF redemptions can create collateral selling pressure on co-held stocks. Our model identifies Walmart Inc. (WMT) as the most exposed collateral stock, sharing 1 ETFs with KR. This is the "Passive Contagion" effect described in the Inelastic Market Hypothesis.
Contagion model based on shared ETF exposure and constituent weights across 32 tracked ETFs. Estimated selling pressure is a simplified model — actual impact depends on market liquidity, ETF redemption mechanics, and market-maker activity.
KR Ownership Dynamics
Passive funds hold 1 in every 7 KR shares, reducing daily market volatility.
The Kroger Co. (KR) exerts measurable gravity on the passive index market, currently representing 2.5% of the State Street Consumer Staples Select Sector SPDR ETF (XLP) and 1.5% of the VDC (VDC). Across 33 tracked ETFs, approximately 89M shares (14.4% of float) are held by passive funds and rarely trade on the open market. This level of passive ownership means index rebalances can create outsized volume events.
ETFs with Highest KR Exposure
Float lock-up computed from 33 ETFs tracked by SecuritiesDB. Actual passive ownership is higher (includes mutual funds, pension funds, etc.).
KR Institutional Volume Profile
252-day volume distribution by price level. The Point of Control (POC) marks — the price where the most institutional volume transacted — an implicit support/resistance floor.
The highest-volume price zone for The Kroger Co. over the past year sits near $66.98 (12% of 252-day volume). The current price of $61.56 sits 8.1% below the POC — suggesting potential mean-reversion upside if institutional demand reasserts at this level. The highly concentrated volume profile (12% at POC) indicates strong consensus on fair value — institutional participants have repeatedly transacted near this price.
Volume Profile computed from 252 trading days of OHLCV data. Volume allocated to price bins proportionally based on daily high-low range. Not investment advice.
KR Capital Efficiency
How efficiently does The Kroger Co. convert operating profits into free cash? The FCF Conversion ratio measures the gap between accounting earnings and real cash generation.
The Kroger Co. converts 60% of its EBITDA into free cash flow, an exceptional conversion rate indicating an asset-light business model with minimal capital reinvestment drag. However, the ROIC-WACC spread is negative (-2.6%), suggesting reinvested capital is destroying shareholder value.
Capital efficiency = Free Cash Flow ÷ EBITDA. Reinvestment = (EBITDA − FCF) ÷ EBITDA. Metrics from latest annual filings. Not investment advice.
Fails-to-Deliver (FTD) History
SEC-reported settlement failures. Elevated FTDs can indicate high short-selling pressure, operational settlement issues, or naked shorting activity.
| Date | Failed Shares | Close Price | Notional Value |
|---|---|---|---|
| 2026-05-14 | 1,146 | $66.24 | $75,911.04 |
| 2026-05-04 | 519 | $67.77 | $35,172.63 |
| 2026-05-01 | 95 | $68.07 | $6,466.65 |
| 2026-04-30 | 20,136 | $67.10 | $1.4M |
| 2026-04-29 | 3,438 | $66.93 | $230,105.34 |
| 2026-04-23 | 1,597 | $68.07 | $108,707.79 |
| 2026-04-22 | 10,161 | $68.81 | $699,178.41 |
| 2026-04-16 | 160 | $66.63 | $10,660.8 |
| 2026-04-15 | 3 | $67.19 | $201.57 |
| 2026-04-09 | 113 | $70.96 | $8,018.48 |
| 2026-03-31 | 70,288 | $73.72 | $5.2M |
| 2026-03-25 | 583 | $71.88 | $41,906.04 |
| 2026-03-23 | 3,236 | $73.20 | $236,875.2 |
| 2026-03-17 | 40,923 | $74.49 | $3.0M |
| 2026-03-12 | 27,958 | $72.19 | $2.0M |
| 2026-03-10 | 96,175 | $73.37 | $7.1M |
| 2026-03-09 | 163,462 | $74.11 | $12.1M |
| 2026-03-06 | 138,071 | $71.57 | $9.9M |
| 2026-03-05 | 1,305 | $67.99 | $88,726.95 |
| 2026-02-27 | 33,000 | $67.18 | $2.2M |
| 2026-02-26 | 4,297 | $67.59 | $290,434.23 |
| 2026-02-25 | 552 | $69.76 | $38,507.52 |
| 2026-02-23 | 16 | $66.36 | $1,061.76 |
| 2026-02-19 | 54 | $68.86 | $3,718.44 |
| 2026-02-09 | 44,882 | $67.50 | $3.0M |
| 2026-02-06 | 2,259 | $66.67 | $150,607.53 |
| 2026-01-28 | 46,010 | $62.11 | $2.9M |
| 2026-01-21 | 99,209 | $63.15 | $6.3M |
| 2026-01-20 | 63,824 | $63.19 | $4.0M |
| 2026-01-15 | 15,349 | $62.46 | $958,698.54 |
Source: SEC Regulation SHO FTD data. Data is reported with a ~30 day delay. High FTD quantities relative to average daily volume may indicate settlement stress.
Price Correlations
Statistical correlation of daily returns with other stocks. High correlations indicate stocks that move together; negative correlations can offer diversification.
| Peer | 252-Day (1Y) | 126-Day (6M) | Direction |
|---|---|---|---|
| WTGXX | NaN | NaN | |
| LRCX | -0.395 | -0.362 | Inverse / hedge |
| CME | 0.381 | 0.345 | Moderate |
| DUK | 0.376 | 0.322 | Moderate |
| WM | 0.375 | 0.369 | Moderate |
| KLAC | -0.373 | -0.307 | Inverse / hedge |
| AMZN | -0.366 | -0.377 | Inverse / hedge |
| AMAT | -0.363 | -0.305 | Inverse / hedge |
| CCI | 0.362 | 0.330 | Moderate |
| GOOGL | -0.359 | -0.351 | Inverse / hedge |
Pearson correlation of daily log returns. 252d ≈ 1 trading year. Computed from price history. Not investment advice.
Compare KR to Peers
Quant metrics computed deterministically from financial statements and price data. Updated: 2026-06-02.
SecuritiesDB provides programmatic data aggregation for informational purposes only. None of the metrics, summaries, or algorithmic flags constitute a recommendation to buy or sell any security.