Hedgeye CEO Keith McCullough is adding Kroger (KR) to the short side of Investing Ideas. Below is a brief note.
Another recent SELL idea by our Independent Research (no banking or Old Wall) team has been Kroger (KR). Yes, it used to be a great COVID long - now it’s a short. Yes, we go both ways, and like it.
Here's Consumables analysts Howard Penney and Daniel Biolsi's summary excerpt from the recent KR report:
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Takeaway: KR is on our Best Idea Short list. Kroger reported FQ3 EPS of $.71 vs. consensus of $.67. ID sales ex.-fuel grew 10.9%, above consensus estimates of 9.3%. Digital sales grew 108% and contributed 4.6% to ID sales. During the current wave of lockdowns, the company is seeing further traffic declines offset by larger baskets. The week of Thanksgiving decelerated compared to the first two weeks of November. Taken together, November tracked at similar levels seen in FQ3 despite the new round of lockdowns. |
Sell the bounce to lower-highs,
KM
