The Kroger Co. (KR) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

+10.7%

$75.59

vs $68.27 price

Levered DCF

$111.22

After debt service

Piotroski score

7 / 9

Strong

Altman Z-score

4.42

Safe zone

Rating

B-

Overall 2 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	40.29×	16.66×	15.43×	14.53×	19.76×	10.42×	13.1×	7.39×
P/B	6.91×	5.32×	2.85×	3.22×	3.42×	2.78×	2.49×	2.88×
P/S	0.28×	0.3×	0.22×	0.22×	0.23×	0.2×	0.18×	0.19×
EV / EBITDA	10.82×	8.53×	7.19×	7.37×	8.42×	6.25×	7.19×	5.31×
Gross margin	23.3%	22.7%	22.2%	21.4%	22.0%	23.3%	22.1%	22.0%
Operating margin	1.3%	2.6%	2.1%	2.8%	2.5%	2.1%	1.8%	2.1%
Net margin	0.7%	1.8%	1.4%	1.5%	1.2%	2.0%	1.4%	2.6%
Current ratio	0.8×	0.96×	0.81×	0.74×	0.75×	0.81×	0.76×	0.76×
Debt / equity	4.16×	3.03×	1.66×	2.03×	2.16×	2.15×	2.46×	1.93×
Interest coverage	2.96×	8.55×	7.02×	7.71×	6.09×	5.11×	3.73×	4.22×
Dividend yield	2.2%	2.0%	2.4%	2.1%	1.8%	2.0%	2.3%	1.9%
Payout ratio	87.1%	33.1%	36.8%	30.4%	35.6%	20.7%	29.3%	14.1%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	17.1%	32.2%	18.6%	22.3%	17.5%	27.0%	19.3%	39.4%
Return on invested capital	4.7%	8.2%	6.7%	9.3%	8.3%	6.1%	5.1%	7.5%
Return on assets	2.0%	5.1%	4.3%	4.5%	3.4%	5.3%	3.7%	8.2%
Free cash flow yield	8.2%	4.0%	8.7%	3.8%	11.1%	14.8%	7.2%	5.3%
Earnings yield	2.5%	6.0%	6.5%	6.9%	5.1%	9.7%	7.7%	13.7%
Enterprise value	$62.3B	$65.2B	$50.5B	$51.7B	$51B	$45.6B	$42.2B	$37.5B
Net debt / EBITDA	3.71×	2.76×	2.47×	2.76×	3.08×	2.59×	3.54×	2.1×
Cash conversion cycle (days)	-6	-4	-5	-3	4	6	8	8