Kroger Co.: 1Q26: Quick Call Takeaways

研报英文原文证据摘录

Kroger Co.: 1Q26: Quick Call Takeaways

Equity Research

U.S. Broadlines, Hardlines & Food Retail

18 June 2026

Kroger Co.

1Q26: Quick Call Takeaways

We come away from Q1 mixed as KR confirmed no reset,

seemed confident that it can offset investments, and will

address price gaps gradually, but plenty of change is still KR EQUAL WEIGHT U.S. Broadlines, Hardlines &

Food Retailneeded, the demand backdrop remains weak, guidance is NEUTRAL

Price Target USD 68.00

more 2H-weighted, and there is uncertainty on the volume Price (17-Jun-26) USD 61.82

inflection. Potential Upside/Downside +10.0%

Source: Bloomberg, Barclays Research

Key highlights: 1) The focus remains on addressing key issues around price, purchasing costs,

U.S. Broadlines, Hardlines & Foodoperating costs, and consistency; 2) Some progress in Q1 from a share perspective (vs.

Retail

conventional grocery) which we are seeing in our benchmarking work as well, but the demand

Seth Sigman

outlook still seems weak, with some headwinds lingering in Q2 (guidance for Q2 comes in +1 212 526 7417

below); 3) FY sales outlook is unchanged, now embedding more inflation, but weaker consumer seth.sigman@barclays.com

trends; doesn’t seem to embed any real benefit from the changes/investments, which is an BCI, US

opportunity, but a lot of change still ahead; 4) Message on price seemed disciplined, with

Oliver Hu

investments expected to be slow and steady (which should be viewed as positive message for +1 212 526 6180

the space overall); 5) KR confirmed no margin reset, and that it can more than fund these oliver.hu@barclays.com

investments and offset other pressures (e.g. COGS related savings are tracking well ahead of BCI, US

their expectations). Gross margin was weaker in Q1 but is expected to improve starting in Q2 as