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∑ The Germans Are Escalating Americaís Grocery Price War
∑ Why You Shouldn't Bet Against Kroger (KR) Stock
The Germans Are Escalating Americaís Grocery Price War
U.S. price war is being fueled by pair of German food chains
ĎSeismicí competition expected to get more intense in 2018
By Craig Giammona, Bloomberg
January 3, 2018
The price war in the American grocery aisle is getting more intense. And believe it or not, the reason isnít Amazon.com Inc.
Amazonís debut as a brick-and-mortar grocery chain last year sent tremors through the supermarket industry, with Kroger Co. and other established players losing billions in market value. But with its plans for Whole Foods developing slowly, Amazon is looking like less of a short-term threat.
For now, Aldi and Lidl -- two no-frills German discounters that are expanding quickly in the U.S. -- are putting more pressure on grocery giants such as Kroger and Wal-Mart Stores Inc.
ďIf itís death by a thousand cuts, Aldi and Lidl are holding the blade,Ē said Mike Paglia, a grocery analyst at the research firm Kantar Retail. ďIt looks a lot like a price war, and youíre starting to see those ripple effects.Ē
Before Amazon.com jolted the food world with its $13.7 billion deal to purchase Whole Foods in June, Lidlís U.S. expansion was the biggest story in the grocery industry. Lidl, which operates thousands of stores across Europe, opened its first 10 U.S. locations on June 15, one day before Amazon announced its blockbuster acquisition.
Amazon still hasnít said much publicly about its long-term plans for Whole Foods. And so far, the takeover hasnít brought sweeping changes. While price cuts on a handful of items drew customers and boosted sales in the wake of the deal, store traffic has returned to where it was before Amazon took over -- when Whole Food was struggling through a prolonged slump, in large part because it was perceived as overpriced.
Of the two European chains, Aldi is more established. Itís operated in America since 1976 and has doubled its U.S. store count over the last 15 years, opening 150 locations in 2017 to push its total above 1,750.
The company has battled Lidl in Europe for decades, and bringing that rivalry to the U.S. is creating a ripple effect for the whole industry. As Lidl enters new markets, Wal-Mart is also cutting prices, which in turn puts pressure on Kroger and other conventional supermarkets.
Price Battle ...
Change of Plans ...
Getting Squeezed ...
Why You Shouldn't Bet Against Kroger (KR) Stock
By Zacks Equity Research, Zacks.com
via Nasdaq - January 03, 2018
One stock that might be an intriguing choice for investors right now is The Kroger Co. KR . This is because this security in the Retail - Supermarkets space is seeing solid earnings estimate revision activity, and is in great company from a Zacks Industry Rank perspective.
This is important because, often times, a rising tide will lift all boats in an industry, as there can be broad trends taking place in a segment that are boosting securities across the board. This is arguably taking place in the Retail - Supermarkets space as it currently has a Zacks Industry Rank of 31 out of more than 250 industries, suggesting it is well-positioned from this perspective, especially when compared to other segments out there.
Meanwhile, Kroger is actually looking pretty good on its own too. The firm has seen solid earnings estimate revision activity over the past month, suggesting analysts are becoming a bit more bullish on the firm's prospects in both the short and long term.
In fact, over the past month, while current quarter estimates have remained stable, current year estimates have risen from $2.01 per share to $2.03 per share...
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