KR - Albertsons May Be Win-Win Proposition With Or Without Kroger Deal

2024-05-19 18:10:51 ET

Summary

• Investor interest in Albertsons has suffered due to FTC/state roadblocks to a proposed merger with Kroger.
• However, Albertsons is cheap enough as a standalone company with stable operations to justify a Buy rating, absent the business marriage.
• With a transaction cash value of $27.25 per ACI share, even better investment returns might be possible over 12-18 months if Kroger backs out.

Albertsons Companies, Inc. ( ACI ) has suffered in price during 2024 on the roadblocks to a merger with Kroger ( KR ), erected by Federal Trade Commission ("FTC") actions and numerous state-filed lawsuits. Two of America's largest grocery chains are trying to create a monster-sized company, which may end up raising prices for customers on reduced competition. I get the conflict inside the fair-trade appraisal process ....

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