BloggingStocks http://www.bloggingstocks.com BloggingStocks http://www.blogsmithmedia.com/http://www.bloggingstocks.com/media/feedlogo.gif BloggingStocks http://www.bloggingstocks.com en-us Copyright 2012 Weblogs, Inc. The contents of this feed are available for non-commercial use only. Blogsmith http://www.blogsmith.com/<![CDATA[Kroger is the defensive play that's right down the street]]>http://www.bloggingstocks.com/2008/01/02/kroger-is-the-defensive-play-thats-right-down-the-street/http://www.bloggingstocks.com/2008/01/02/kroger-is-the-defensive-play-thats-right-down-the-street/http://www.bloggingstocks.com/2008/01/02/kroger-is-the-defensive-play-thats-right-down-the-street/#commentsFiled under: ,

The market's choppy / consolidating pattern continues, suggesting the need for a defensive play or two (or perhaps more) as the new year begins. Further, there are few defensive plays better than a grocery store chain, and in this category Kroger is worth a review.

The Kroger Co. (NYSE: KR) is the nation's largest grocery chain, boasting more than 2,400 stores, with the typical format being food/drug store combination stores.

Analysts see modest sales growth in 2008 of 4-7% but margins should widen, due to Kroger's ability to pass on product cost increases, and a more-modest advertising budget.

In general, analysts also sense that Kroger is in-tune with competitive pressures in the grocery chain segment - - improving customer service levels and the overall shopping experience. Further, look for KR's private label items to play a larger role in revenue, particularly as some consumers switch down to generic brands in 2008 to reduce their food costs. The Reuters FY 2008/FY 2009 EPS consensus estimates for KR are $1.69 to $1.89.

Continue reading Kroger is the defensive play that's right down the street

Kroger is the defensive play that's right down the street originally appeared on BloggingStocks on Wed, 02 Jan 2008 17:58:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>consumer stocksConsumerGoodsDefensiveStocksgrocersgrocery store chainsKRKrogerWed, 02 Jan 2008 17:58:00 EST<![CDATA[Safeway is a safe harbor]]>http://www.bloggingstocks.com/2007/12/14/safeway-is-a-safe-harbor/http://www.bloggingstocks.com/2007/12/14/safeway-is-a-safe-harbor/http://www.bloggingstocks.com/2007/12/14/safeway-is-a-safe-harbor/#commentsFiled under: , ,

The market's choppy/consolidating pattern (or perhaps worse) continues, with several unknowns weighing on the minds of investors. It goes without saying then, that in this market defensive stocks represent a prudent addition to almost any portfolio. The grocery store sector is a dependable defensive, and in this category, Safeway is worth a review.

Safeway Inc. (NYSE: SWY) is one of North America's largest grocery store chains, with more than 1,700 stores, primarily in the West, Midwest, and Mid-Atlantic United States. Safeway also operates the Vons, Dominick's Finer Foods, Carr-Gottstein (Alaska), Genuardi's, and Randall's Food Market Chains (Texas). SWY also has an international presence via ownership of about 125 Casa Ley food/variety stores in Mexico.

Analysts expect 2008 sales to increase about 3%-5% to about $44 billion, up from about $41.8 billion in 2007, as Safeway increasingly sees the fruits of a store remodeling campaign. Gross margins should remain adequate. The Reuters fiscal year (FY) 2007/2008 earnings per share (EPS) consensus estimates for SWY are $2.01 to $2.24.

Other positives: Safeway has struck the right balance between its high quality/wide selection Safeway stores and Safeway supercenters: the former, via remodeling, better reflect middle-income customers' needs, and the later have displayed solid traffic. This winning formula leads many analysts to conclude that Safeway should be able to build on its 8% grocery store sector market share.

The risks? Analysts are keeping an eye on intensifying competition: wholesale operations and warehouses represent the biggest threat, as they boast comparable economies of scale.

The First Call mean rating for SWY is: Hold [15 firms]. Mean 2008 target: $39.00 [high: $42, low: $34].

Stock Analysis: Safeway is a moderate-risk stock not suitable for low-risk investors. Investors with an investment horizon longer than 2 years should be rewarded from SWY's shares. Sell/Stop Loss if you were to purchase shares in this company: $23.

Safeway is a safe harbor originally appeared on BloggingStocks on Fri, 14 Dec 2007 18:57:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>consumer goodsdefensive stocksgrocery store chainsgrocery storesSafewaySWYFri, 14 Dec 2007 18:57:00 EST