Supermarket giant Kroger got a rating upgrade Thursday after its stock hit an all-time high days earlier. Additionally, its IBD Relative Strength (RS) Rating climbed from 79 the day before to 82 Thursday. Market research shows that the market's biggest winners tend to have an 80 or better RS Rating as they launch their biggest runs.
Kroger's new 82 RS Rating shows that the Cincinnati-based grocer topped 82% of all stocks for price performance this past year. It has good ratings and large funds are eager buyers even though the company's fundamentals could use a lift.
Kroger stock carries an 83 Composite Rating, putting it in the top 17% of all stocks for a group of five fundamental and technical metrics. Its EPS Rating is a decent but not outstanding 73, reflecting mild profit growth.
Kroger Stock A Favorite Of Big Money Investors
One outstanding indicator is its A- Accumulation/Distribution Rating on an A+ to E scale. The A- rating shows that big funds such as ETFs and insurance company funds are eager buyers of its stock. With institutional buying accounting for about 70% of all trades it's key to know which stocks those funds are buying.
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Shares of Kroger, the nation's largest independent supermarket chain, rose about 30% from a 49.05 low on June 26 to a record high 63.59 on Dec. 12. It's consolidated the last few days and traded at 60.96 Thursday, up fractionally for the day.
Regarding top and bottom line numbers, the company has posted improving EPS numbers in each of the last two reports, although sales edged down. Last quarter Kroger reported a 3% rise in earning to 98 cents per share on a 1% dip in sales to $33.6 billion.
No. 3 In Grocery Industry Group
Kroger holds the No. 3 rank among its peers in the 12-stock Retail-Super/Mini Markets industry group. Sprouts Farmers Market is the top-ranked stock in the group.
IBD's proprietary RS Rating identifies market leadership by using a 1 (worst) to 99 (best) score that shows how a stock's price performance over the last 52 weeks matches up against other publicly traded companies.
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