Shares of Kroger (KR -0.75%) popped 9.9% on Thursday after the grocery store chain announced strong fourth-quarter 2023 results and better-than-expected forward guidance.
Kroger ended the year on a high note
For its fourth quarter of 2023, Kroger's total company sales grew 6.4% year over year to $37.06 billion, including around $2.7 billion from an extra week in the quarter relative to the same year-ago period. Identical sales without fuel declined by 0.8%. On the bottom line, that translated to net earnings of $1.34 per share, or $1.14 per share excluding a $0.20-per-share benefit from the extra week. Most analysts were modeling earnings of $1.13 per share on roughly the same revenue.
Kroger Chairman and CEO Rodney McMullen called it the end of a "strong" year that was in line with the company's long-term growth model.
"As customers manage macroeconomic pressures, we are lowering prices and offering even more ways to save with personalized promotions and rewards," he added, crediting Kroger's "unique seamless shopping experience" for their solid performance.
What's next for Kroger investors?
For the full year 2024, Kroger expects identical sales growth without fuel of 0.25% to 1.75%, with adjusted net earnings per share of $4.30 to $4.50. The midpoint of that earnings range is well above analysts' consensus estimates for full-year earnings of $4.34 per share.
In the end, this was as strong a quarter and forward guidance as any investor could have hoped, given broader macroeconomic concerns and dampened consumer spending patterns. Kroger stock is understandably rallying in response.
