KR - Kroger falls on margin concerns drags on grocery names

Kroger’s (NYSE:KR) concerns on supply chain and margin erosion are rippling across the grocery sector on Thursday. The largest US grocery chain by sales reported an overall strong first quarter, adding to optimism by raising its full year forecasts for EPS and same store sales. However, a broad-based selloff and a jittery market moved shares sharply downward on what might otherwise be minor concerns in the context of the full report. Chief among these concerns was margin contraction amid cost increases, according to Bloomberg Intelligence analysts Jennifer Bartashus and Gopal Srinivasan.  “Despite better-than-expected fiscal 1Q sales and earnings and higher full-year guidance, we believe Kroger faces a tough road balancing growth initiatives while keeping operating costs low amid a highly inflationary environment,” the team explained. “Concerns about gross-margin erosion persist, as higher costs for products,transportation and labor may not be fully offset by savings goals.” Given Kroger’s < > issues with

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Kroger falls on margin concerns, drags on grocery names