Intrinsic value of Kroger - KR

Previous Close

$27.99

  Intrinsic Value

$25.91

stock screener

  Rating & Target

hold

-7%

Previous close

$27.99

 
Intrinsic value

$25.91

 
Up/down potential

-7%

 
Rating

hold

We calculate the intrinsic value of KR stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2017), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 26.4

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046
   2047

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
Revenue, $m
  121,104
  127,159
  133,517
  140,193
  147,202
  154,563
  162,291
  170,405
  178,926
  187,872
  197,265
  207,129
  217,485
  228,359
  239,777
  251,766
  264,355
  277,572
  291,451
  306,023
  321,325
  337,391
  354,260
  371,973
  390,572
  410,101
  430,606
  452,136
  474,743
  498,480
Variable operating expenses, $m
  117,087
  122,920
  129,045
  135,476
  142,229
  149,320
  156,765
  164,582
  172,790
  181,409
  190,040
  199,542
  209,519
  219,995
  230,995
  242,545
  254,672
  267,405
  280,776
  294,814
  309,555
  325,033
  341,285
  358,349
  376,266
  395,080
  414,834
  435,575
  457,354
  480,222
Fixed operating expenses, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  117,087
  122,920
  129,045
  135,476
  142,229
  149,320
  156,765
  164,582
  172,790
  181,409
  190,040
  199,542
  209,519
  219,995
  230,995
  242,545
  254,672
  267,405
  280,776
  294,814
  309,555
  325,033
  341,285
  358,349
  376,266
  395,080
  414,834
  435,575
  457,354
  480,222
Operating income, $m
  4,017
  4,239
  4,472
  4,717
  4,973
  5,243
  5,526
  5,823
  6,135
  6,463
  7,225
  7,587
  7,966
  8,364
  8,782
  9,222
  9,683
  10,167
  10,675
  11,209
  11,769
  12,358
  12,976
  13,625
  14,306
  15,021
  15,772
  16,561
  17,389
  18,258
EBITDA, $m
  6,991
  7,341
  7,708
  8,093
  8,498
  8,923
  9,369
  9,837
  10,329
  10,845
  11,388
  11,957
  12,555
  13,183
  13,842
  14,534
  15,261
  16,024
  16,825
  17,666
  18,549
  19,477
  20,451
  21,473
  22,547
  23,674
  24,858
  26,101
  27,406
  28,776
Interest expense (income), $m
  505
  760
  842
  926
  1,015
  1,108
  1,206
  1,309
  1,417
  1,530
  1,649
  1,774
  1,906
  2,043
  2,188
  2,340
  2,499
  2,667
  2,843
  3,027
  3,221
  3,424
  3,638
  3,863
  4,098
  4,345
  4,605
  4,878
  5,164
  5,465
  5,781
Earnings before tax, $m
  3,257
  3,397
  3,546
  3,701
  3,865
  4,036
  4,217
  4,406
  4,605
  4,813
  5,451
  5,681
  5,923
  6,176
  6,443
  6,722
  7,016
  7,324
  7,648
  7,988
  8,345
  8,720
  9,113
  9,526
  9,960
  10,416
  10,894
  11,396
  11,924
  12,477
Tax expense, $m
  879
  917
  957
  999
  1,043
  1,090
  1,139
  1,190
  1,243
  1,300
  1,472
  1,534
  1,599
  1,668
  1,740
  1,815
  1,894
  1,978
  2,065
  2,157
  2,253
  2,354
  2,461
  2,572
  2,689
  2,812
  2,941
  3,077
  3,219
  3,369
Net income, $m
  2,378
  2,480
  2,588
  2,702
  2,821
  2,947
  3,078
  3,216
  3,361
  3,514
  3,979
  4,147
  4,324
  4,509
  4,703
  4,907
  5,122
  5,347
  5,583
  5,831
  6,092
  6,365
  6,653
  6,954
  7,271
  7,604
  7,953
  8,319
  8,704
  9,108

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  38,336
  40,253
  42,266
  44,379
  46,598
  48,928
  51,374
  53,943
  56,640
  59,472
  62,446
  65,568
  68,846
  72,288
  75,903
  79,698
  83,683
  87,867
  92,260
  96,874
  101,717
  106,803
  112,143
  117,750
  123,638
  129,820
  136,311
  143,126
  150,283
  157,797
Adjusted assets (=assets-cash), $m
  38,336
  40,253
  42,266
  44,379
  46,598
  48,928
  51,374
  53,943
  56,640
  59,472
  62,446
  65,568
  68,846
  72,288
  75,903
  79,698
  83,683
  87,867
  92,260
  96,874
  101,717
  106,803
  112,143
  117,750
  123,638
  129,820
  136,311
  143,126
  150,283
  157,797
Revenue / Adjusted assets
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
  3.159
Average production assets, $m
  25,553
  26,831
  28,172
  29,581
  31,060
  32,613
  34,243
  35,956
  37,753
  39,641
  41,623
  43,704
  45,889
  48,184
  50,593
  53,123
  55,779
  58,568
  61,496
  64,571
  67,799
  71,189
  74,749
  78,486
  82,411
  86,531
  90,858
  95,401
  100,171
  105,179
Working capital, $m
  727
  763
  801
  841
  883
  927
  974
  1,022
  1,074
  1,127
  1,184
  1,243
  1,305
  1,370
  1,439
  1,511
  1,586
  1,665
  1,749
  1,836
  1,928
  2,024
  2,126
  2,232
  2,343
  2,461
  2,584
  2,713
  2,848
  2,991
Total debt, $m
  15,591
  17,157
  18,801
  20,528
  22,340
  24,244
  26,243
  28,341
  30,545
  32,859
  35,288
  37,839
  40,517
  43,330
  46,283
  49,383
  52,639
  56,057
  59,647
  63,416
  67,373
  71,528
  75,891
  80,472
  85,282
  90,333
  95,636
  101,204
  107,051
  113,190
Total liabilities, $m
  31,321
  32,887
  34,531
  36,258
  38,070
  39,974
  41,973
  44,071
  46,275
  48,589
  51,018
  53,569
  56,247
  59,060
  62,013
  65,113
  68,369
  71,787
  75,377
  79,146
  83,103
  87,258
  91,621
  96,202
  101,012
  106,063
  111,366
  116,934
  122,781
  128,920
Total equity, $m
  7,016
  7,366
  7,735
  8,121
  8,527
  8,954
  9,401
  9,872
  10,365
  10,883
  11,428
  11,999
  12,599
  13,229
  13,890
  14,585
  15,314
  16,080
  16,884
  17,728
  18,614
  19,545
  20,522
  21,548
  22,626
  23,757
  24,945
  26,192
  27,502
  28,877
Total liabilities and equity, $m
  38,337
  40,253
  42,266
  44,379
  46,597
  48,928
  51,374
  53,943
  56,640
  59,472
  62,446
  65,568
  68,846
  72,289
  75,903
  79,698
  83,683
  87,867
  92,261
  96,874
  101,717
  106,803
  112,143
  117,750
  123,638
  129,820
  136,311
  143,126
  150,283
  157,797
Debt-to-equity ratio
  2.220
  2.330
  2.430
  2.530
  2.620
  2.710
  2.790
  2.870
  2.950
  3.020
  3.090
  3.150
  3.220
  3.280
  3.330
  3.390
  3.440
  3.490
  3.530
  3.580
  3.620
  3.660
  3.700
  3.730
  3.770
  3.800
  3.830
  3.860
  3.890
  3.920
Adjusted equity ratio
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  2,378
  2,480
  2,588
  2,702
  2,821
  2,947
  3,078
  3,216
  3,361
  3,514
  3,979
  4,147
  4,324
  4,509
  4,703
  4,907
  5,122
  5,347
  5,583
  5,831
  6,092
  6,365
  6,653
  6,954
  7,271
  7,604
  7,953
  8,319
  8,704
  9,108
Depreciation, amort., depletion, $m
  2,974
  3,101
  3,236
  3,376
  3,524
  3,680
  3,843
  4,014
  4,194
  4,382
  4,162
  4,370
  4,589
  4,818
  5,059
  5,312
  5,578
  5,857
  6,150
  6,457
  6,780
  7,119
  7,475
  7,849
  8,241
  8,653
  9,086
  9,540
  10,017
  10,518
Funds from operations, $m
  5,351
  5,581
  5,824
  6,078
  6,346
  6,626
  6,921
  7,230
  7,555
  7,896
  8,142
  8,518
  8,912
  9,327
  9,762
  10,220
  10,700
  11,204
  11,733
  12,288
  12,872
  13,484
  14,128
  14,803
  15,512
  16,257
  17,038
  17,859
  18,721
  19,626
Change in working capital, $m
  35
  36
  38
  40
  42
  44
  46
  49
  51
  54
  56
  59
  62
  65
  69
  72
  76
  79
  83
  87
  92
  96
  101
  106
  112
  117
  123
  129
  136
  142
Cash from operations, $m
  5,317
  5,545
  5,786
  6,038
  6,304
  6,582
  6,875
  7,182
  7,504
  7,843
  8,085
  8,458
  8,850
  9,262
  9,694
  10,148
  10,624
  11,124
  11,649
  12,201
  12,780
  13,388
  14,026
  14,697
  15,400
  16,139
  16,915
  17,730
  18,586
  19,484
Maintenance CAPEX, $m
  -2,430
  -2,555
  -2,683
  -2,817
  -2,958
  -3,106
  -3,261
  -3,424
  -3,596
  -3,775
  -3,964
  -4,162
  -4,370
  -4,589
  -4,818
  -5,059
  -5,312
  -5,578
  -5,857
  -6,150
  -6,457
  -6,780
  -7,119
  -7,475
  -7,849
  -8,241
  -8,653
  -9,086
  -9,540
  -10,017
New CAPEX, $m
  -1,255
  -1,278
  -1,342
  -1,409
  -1,479
  -1,553
  -1,631
  -1,712
  -1,798
  -1,888
  -1,982
  -2,081
  -2,185
  -2,294
  -2,409
  -2,530
  -2,656
  -2,789
  -2,928
  -3,075
  -3,229
  -3,390
  -3,559
  -3,737
  -3,924
  -4,121
  -4,327
  -4,543
  -4,770
  -5,009
Cash from investing activities, $m
  -3,685
  -3,833
  -4,025
  -4,226
  -4,437
  -4,659
  -4,892
  -5,136
  -5,394
  -5,663
  -5,946
  -6,243
  -6,555
  -6,883
  -7,227
  -7,589
  -7,968
  -8,367
  -8,785
  -9,225
  -9,686
  -10,170
  -10,678
  -11,212
  -11,773
  -12,362
  -12,980
  -13,629
  -14,310
  -15,026
Free cash flow, $m
  1,632
  1,712
  1,761
  1,813
  1,867
  1,923
  1,983
  2,045
  2,111
  2,180
  2,139
  2,215
  2,295
  2,378
  2,466
  2,559
  2,656
  2,757
  2,864
  2,976
  3,094
  3,218
  3,348
  3,484
  3,627
  3,778
  3,936
  4,102
  4,276
  4,458
Issuance/(repayment) of debt, $m
  1,514
  1,566
  1,644
  1,727
  1,813
  1,904
  1,999
  2,099
  2,204
  2,314
  2,429
  2,551
  2,678
  2,812
  2,953
  3,101
  3,256
  3,418
  3,589
  3,769
  3,957
  4,155
  4,363
  4,581
  4,810
  5,051
  5,303
  5,568
  5,847
  6,139
Issuance/(repurchase) of shares, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  1,514
  1,566
  1,644
  1,727
  1,813
  1,904
  1,999
  2,099
  2,204
  2,314
  2,429
  2,551
  2,678
  2,812
  2,953
  3,101
  3,256
  3,418
  3,589
  3,769
  3,957
  4,155
  4,363
  4,581
  4,810
  5,051
  5,303
  5,568
  5,847
  6,139
Total cash flow (excl. dividends), $m
  3,146
  3,278
  3,405
  3,539
  3,679
  3,827
  3,981
  4,144
  4,314
  4,493
  4,568
  4,766
  4,973
  5,191
  5,419
  5,659
  5,911
  6,176
  6,454
  6,745
  7,052
  7,373
  7,711
  8,065
  8,438
  8,828
  9,239
  9,670
  10,122
  10,597
Retained Cash Flow (-), $m
  -318
  -351
  -368
  -387
  -406
  -426
  -448
  -470
  -494
  -518
  -544
  -571
  -600
  -630
  -661
  -695
  -729
  -766
  -804
  -844
  -886
  -931
  -977
  -1,026
  -1,077
  -1,131
  -1,188
  -1,247
  -1,310
  -1,375
Prev. year cash balance distribution, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  115
  121
  127
  134
  140
  147
  155
  162
  170
  179
  188
  197
  207
  217
  228
  240
  252
  264
  278
  291
  306
  321
  337
  354
  372
  391
  410
  431
  452
  475
Cash available for distribution, $m
  2,828
  2,927
  3,037
  3,152
  3,273
  3,400
  3,534
  3,674
  3,821
  3,975
  4,024
  4,194
  4,373
  4,561
  4,758
  4,965
  5,182
  5,410
  5,650
  5,901
  6,165
  6,442
  6,734
  7,039
  7,360
  7,697
  8,051
  8,423
  8,813
  9,222
Discount rate, %
  8.30
  8.72
  9.15
  9.61
  10.09
  10.59
  11.12
  11.68
  12.26
  12.88
  13.52
  14.20
  14.91
  15.65
  16.43
  17.26
  18.12
  19.02
  19.97
  20.97
  22.02
  23.12
  24.28
  25.49
  26.77
  28.11
  29.51
  30.99
  32.54
  34.16
PV of cash for distribution, $m
  2,611
  2,477
  2,336
  2,184
  2,024
  1,858
  1,689
  1,518
  1,349
  1,184
  997
  853
  718
  596
  486
  389
  306
  235
  178
  131
  94
  66
  45
  30
  20
  12
  7
  4
  2
  1
Current shareholders' claim on cash, %
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

The Kroger Co. (Kroger) manufactures and processes food for sale in its supermarkets. The Company operates supermarkets, multi-department stores, jewelry stores and convenience stores throughout the United States. As of January 28, 2017, it had operated approximately 4,000 owned or leased supermarkets, convenience stores, fine jewelry stores, distribution warehouses and food production plants through divisions, subsidiaries or affiliates. These facilities are located throughout the United States. As of January 28, 2017, Kroger operated, either directly or through its subsidiaries, 2,796 supermarkets under a range of local banner names, of which 2,255 had pharmacies and 1,445 had fuel centers. As of January 28, 2017, the Company offered ClickList and Harris Teeter ExpressLane, personalized, order online, pick up at the store services at 637 of its supermarkets. P$$T, Check This Out and Heritage Farm are the three brands. Its other brands include Simple Truth and Simple Truth Organic.

FINANCIAL RATIOS  of  Kroger (KR)

Valuation Ratios
P/E Ratio 13.1
Price to Sales 0.2
Price to Book 3.9
Price to Tangible Book
Price to Cash Flow 6.1
Price to Free Cash Flow 45.1
Growth Rates
Sales Growth Rate 5%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 10.5%
Cap. Spend. - 3 Yr. Gr. Rate 9.7%
Financial Strength
Quick Ratio 0
Current Ratio 0.1
LT Debt to Equity 176.5%
Total Debt to Equity 210.2%
Interest Coverage 7
Management Effectiveness
Return On Assets 6.6%
Ret/ On Assets - 3 Yr. Avg. 6.9%
Return On Total Capital 10%
Ret/ On T. Cap. - 3 Yr. Avg. 10.5%
Return On Equity 29.2%
Return On Equity - 3 Yr. Avg. 31.5%
Asset Turnover 3.3
Profitability Ratios
Gross Margin 22.4%
Gross Margin - 3 Yr. Avg. 21.9%
EBITDA Margin 5%
EBITDA Margin - 3 Yr. Avg. 4.9%
Operating Margin 3%
Oper. Margin - 3 Yr. Avg. 3%
Pre-Tax Margin 2.5%
Pre-Tax Margin - 3 Yr. Avg. 2.6%
Net Profit Margin 1.7%
Net Profit Margin - 3 Yr. Avg. 1.7%
Effective Tax Rate 32.8%
Eff/ Tax Rate - 3 Yr. Avg. 33.6%
Payout Ratio 21.7%

KR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the KR stock intrinsic value calculation we used $115337 million for the last fiscal year's total revenue generated by Kroger. The default revenue input number comes from 2017 income statement of Kroger. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our KR stock valuation model: a) initial revenue growth rate of 5% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 8.3%, whose default value for KR is calculated based on our internal credit rating of Kroger, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Kroger.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of KR stock the variable cost ratio is equal to 96.7%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for KR stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Kroger.

Corporate tax rate of 27% is the nominal tax rate for Kroger. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the KR stock is equal to 0.1%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for KR are equal to 21.1%.

Life of production assets of 10 years is the average useful life of capital assets used in Kroger operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for KR is equal to 0.6%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $6698 million for Kroger - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 942 million for Kroger is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Kroger at the current share price and the inputted number of shares is $26.4 billion.

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COMPANY NEWS

▶ Kroger Releases Annual Sustainability Report   [Jul-18-18 01:00PM  PR Newswire]
▶ Kroger replaces Cincinnati market president   [12:29PM  American City Business Journals]
▶ FIRST LOOK: Kroger unveils $19 million renovation in East End (PHOTOS)   [11:49AM  American City Business Journals]
▶ 4 Top Ranked Growth Stocks to Buy for July 16th   [Jul-16-18 01:25PM  InvestorPlace]
▶ Kroger stock could double, analyst says   [12:48PM  American City Business Journals]
▶ Kroger: Why It Might Be Poised to Double   [08:14AM  Barrons.com]
▶ Amazon pays Prime members to shop at Whole Foods   [02:44PM  American City Business Journals]
▶ What's next for 4 of Kroger's 14 shuttering Triangle stores?   [Jul-11-18 03:11PM  American City Business Journals]
▶ Corrections & Amplifications   [Jul-10-18 07:52PM  The Wall Street Journal]
▶ Kroger signs designer to launch new fashion line   [Jul-09-18 12:11PM  American City Business Journals]
▶ Kroger to hire 250 at massive Greater Cincinnati distribution center   [11:00AM  American City Business Journals]
▶ Should You Invest in Meal Kits?   [Jul-07-18 01:10PM  Motley Fool]
▶ Why Kroger Stock Gained 17% in June   [Jul-06-18 10:03AM  Motley Fool]
▶ One year later, Lidl expansion has fallen short   [09:32AM  American City Business Journals]
▶ One year later, Kroger rival Lidls US expansion has fallen short   [06:15AM  American City Business Journals]
▶ One year later, Kroger rival Lidls U.S. expansion has fallen short   [Jul-03-18 02:26PM  American City Business Journals]
▶ Layoff notices reveal impact of Kroger's Triangle exit   [01:42PM  American City Business Journals]
▶ Kroger to expand NKY operations, hire more than 140   [02:43PM  American City Business Journals]
▶ [$$] Kroger Plans to Introduce Driverless Grocery Deliveries   [Jun-28-18 08:20PM  The Wall Street Journal]
▶ Krogers latest deals make it a high-tech food provider   [02:54PM  American City Business Journals]
▶ Kroger CEO updates downtown store progress   [02:15PM  American City Business Journals]
▶ P&G, Macys and Kroger among nations largest advertisers   [01:53PM  American City Business Journals]
▶ Kroger to launch grocery delivery via driverless cars   [10:26AM  American City Business Journals]
▶ Kroger details plans for 1,000-job downtown digital HQ   [Jun-27-18 11:11PM  American City Business Journals]
▶ Kroger analyst bucks trend, downgrades stock   [02:43PM  American City Business Journals]
▶ Kroger shareholders to vote on whether to replace McMullen as chairman   [02:31PM  American City Business Journals]
▶ EXCLUSIVE: Kroger prompts Cincinnati craft brewery to double capacity   [02:30PM  American City Business Journals]
▶ Kroger set to hire nearly 600 employees downtown   [Jun-25-18 10:28PM  American City Business Journals]
▶ What Kroger Management Wants You to Know   [08:00PM  Motley Fool]
▶ Is It Finally Safe to Buy The Kroger Co. Stock?   [Jun-23-18 07:00PM  Motley Fool]
▶ 2 Surprising Stocks Made Big Moves This Week   [Jun-22-18 07:43PM  Motley Fool]
▶ Kroger Completes Merger with Home Chef   [04:05PM  PR Newswire]
▶ Company News For Jun 22, 2018   [10:03AM  Zacks]
▶ [$$] The Company Beating Amazon in Grocery Delivery   [05:30AM  The Wall Street Journal]
▶ [$$] Krogers New Approach to Stocking Shelves Is Boosting Earnings   [Jun-21-18 11:41PM  The Wall Street Journal]
▶ [$$] Kroger Spends Money to Make Money   [07:39PM  The Wall Street Journal]
▶ What Happened in the Stock Market Today   [05:05PM  Motley Fool]
▶ Kroger can thrive in face of Amazon, Walmart, analysts say   [02:50PM  American City Business Journals]
▶ The Winners and Losers in Thursday's Market   [02:38PM  TheStreet.com]
▶ Kroger aims to reach 'everyone in America,' CEO says   [02:30PM  American City Business Journals]
▶ Why Kroger Co. Stock Jumped Today   [01:57PM  Motley Fool]
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