The Kroger Co. (KR) Hit a 52 Week High, Can the Run Continue?

Shares of Kroger (KR) have been strong performers lately, with the stock up 6.5% over the past month. The stock hit a new 52-week high of $59.92 in the previous session. Kroger has gained 30.8% since the start of the year compared to the 25.6% move for the Zacks Retail-Wholesale sector and the 56.4% return for the Zacks Retail - Supermarkets industry.What's Driving the Outperformance?The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on September 12, 2024, Kroger reported EPS of $0.93 versus consensus estimate of $0.92 while it missed the consensus revenue estimate by 0.46%.For the current fiscal year, Kroger is expected to post earnings of $4.46 per share on $148.76 billion in revenues. This represents a -6.3% change in EPS on a -0.85% change in revenues. For the next fiscal year, the company is expected to earn $4.64 per share on $151.59 billion in revenues. This represents a year-over-year change of 4.05% and 1.9%, respectively.Valuation MetricsKroger may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.Kroger has a Value Score of A. The stock's Growth and Momentum Scores are B and F, respectively, giving the company a VGM Score of A.In terms of its value breakdown, the stock currently trades at 13.4X current fiscal year EPS estimates, which is not in-line with the peer industry average of 14.6X. On a trailing cash flow basis, the stock currently trades at 6X versus its peer group's average of 6X. Additionally, the stock has a PEG ratio of 0.93. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.Zacks RankWe also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Kroger currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Kroger meets the list of requirements. Thus, it seems as though Kroger shares could still be poised for more gains ahead.How Does KR Stack Up to the Competition?Shares of KR have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Walmart Inc. (WMT). WMT has a Zacks Rank of # 2 (Buy) and a Value Score of C, a Growth Score of A, and a Momentum Score of D.Earnings were strong last quarter. Walmart Inc. beat our consensus estimate by 3.08%, and for the current fiscal year, WMT is expected to post earnings of $2.44 per share on revenue of $678.74 billion.Shares of Walmart Inc. have gained 3.8% over the past month, and currently trade at a forward P/E of 34.23X and a P/CF of 22.6X.The Retail - Supermarkets industry is in the top 37% of all the industries we have in our universe, so it looks like there are some nice tailwinds for KR and WMT, even beyond their own solid fundamental situation.Free Today: Profiting from The Future’s Brightest Energy SourceThe demand for electricity is growing exponentially. At the same time, we’re working to reduce our dependence on fossil fuels like oil and natural gas. Nuclear energy is an ideal replacement.Leaders from the US and 21 other countries recently committed to TRIPLING the world’s nuclear energy capacities. This aggressive transition could mean tremendous profits for nuclear-related stocks – and investors who get in on the action early enough.Our urgent report, Atomic Opportunity: Nuclear Energy's Comeback, explores the key players and technologies driving this opportunity, including 3 standout stocks poised to benefit the most.Download Atomic Opportunity: Nuclear Energy's Comeback free today.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Kroger Co. (KR): Free Stock Analysis Report Walmart Inc. (WMT): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks