Core Viewpoint - Albertsons Companies, Inc. is experiencing stable financial performance as an independent entity, despite a proposed merger with Kroger facing significant regulatory scrutiny and skepticism from the market [2][6][14] Financial Performance - Albertsons' revenue has grown by 32.8% since FY2016, comparable to Kroger's 30.1% and Walmart's 33.4% [4] - The operating margin for Albertsons in FY2023 is 3.0%, lower than Kroger's 3.3% and Walmart's 4.2%, but has shown good margin expansion [4][5] - Return on capital for Albertsons stands at 8.8%, above the consumer staples sector median of 6.8% [5] Merger with Kroger - Kroger's acquisition offer for Albertsons is priced at $34.1 per share, but the stock is currently trading 35% below this price, indicating market skepticism about the merger's success [6] - The FTC has filed to block the merger due to concerns over pricing power, with various stakeholders expressing opposition [6][14] - Kroger and Albertsons have agreed to sell 579 stores to C&S to improve merger prospects, but market sentiment remains cautious [6] Valuation - Albertsons trades at a forward normalized P/E of 8.1, significantly lower than Kroger's 11.7 and Walmart's 27.7, indicating a potential upside of 45% to 242% [7] - The DCF model estimates a fair value for Albertsons at $38.44, suggesting a 90% upside from the current stock price [9][14] Market Position - Despite the ongoing merger challenges, Albertsons continues to perform on par with other grocery chains, maintaining a stable operational profile [14] - The valuation gap compared to peers and the consumer staples sector indicates that Albertsons is undervalued, presenting a strong investment opportunity [7][14]

Core Insights - Rokt has partnered with Albertsons Media Collective to enhance customer engagement through non-endemic advertising, allowing brands not sold by Albertsons to reach its ecommerce customers [1][2][3] - The partnership aims to drive customer loyalty and improve the shopping experience by delivering relevant offers during the transaction moment, which is when customers are most likely to respond [2][3] - Albertsons will utilize Rokt's technology to expand its advertising capabilities across its own channels and Rokt's network of premium ecommerce merchants [3][4] Company Overview - Rokt is a leading ecommerce technology company that leverages machine learning and AI to enhance transaction relevance, processing over 5 billion transactions annually across various industries [4][5] - Albertsons Media Collective is a retail media network that connects with consumers in over 2,200 locations across 34 states, focusing on innovative marketing solutions and first-party data to drive retail sales [6]

Core Insights - Kimco Realty reported a net loss of $18.9 million, or $0.03 per diluted share, for Q1 2024, compared to a net income of $283.5 million, or $0.46 per diluted share, in Q1 2023, primarily due to a one-time special dividend received in the previous year [1][4][21] Financial Performance - Funds From Operations (FFO) for Q1 2024 was $261.8 million, or $0.39 per diluted share, including $25.2 million in merger-related charges [5][24] - Same Property Net Operating Income (NOI) grew by 3.9% year-over-year, driven by a 2.8% increase in minimum rent [2][7] - The company achieved a pro-rata portfolio occupancy of 96.0%, with anchor and small shop occupancy rates at 97.8% and 91.5%, respectively [2][7] Acquisition and Disposition Activities - Kimco completed the $2.3 billion acquisition of RPT Realty on January 2, 2024, and disposed of ten former RPT properties for $248 million, achieving its 2024 disposition target [2][3][8] - The acquisition of RPT resulted in a $60.6 million increase in consolidated revenues from rental properties [4] Capital Market Activities - The company repaid unsecured notes totaling $646.9 million during Q1 2024 and has no remaining unsecured debt [9] - Kimco sold 14.2 million shares of ACI common stock, generating $299.1 million in net proceeds [9] Dividend Declarations - The board declared a quarterly cash dividend of $0.24 per share, payable on June 20, 2024 [10] 2024 Full Year Outlook - The company updated its guidance for 2024, projecting net income of $0.40 to $0.44 per diluted share and FFO of $1.56 to $1.60 per diluted share [11][12]

Before considering which stocks to buy if inflation continues, it’s good to remember the relationship between inflation and interest rates. The latest reading on CPI and PPI shows that the declining inflation rate may be ramping back up.  The takeaway is that the Fed is less likely to lower interest rates, which puts pressure on equities. But while some stocks will struggle, others are built to shine during rising inflation. These are the companies that deliver the products and services that consumers need ...

We've seen a very volatile stock market in recent weeks. That's created an opportunity to buy these three winners at bargain prices.While it's bounced back a little in recent trading days, the stock market is still off all-time highs. Moreover, some great stocks that sold off have remained down. This is despite their high-quality businesses that should generate profits that reward investors for many years to come.Instead of lamenting their lack of bouncing back, investors shouldn't miss out on the chance to ...

Core Insights - Albertsons Companies, Inc. (ACI) reported mixed fourth-quarter fiscal 2023 results, with earnings in line with estimates but sales missing expectations [1][3] - The company's top line saw a marginal year-over-year increase, while the bottom line declined [1] - ACI's strategy focuses on operational excellence, digital expansion, pharmacy operations, and customer relationships to drive growth [1] Financial Performance - Adjusted quarterly earnings were 54 cents per share, a decline of 31.6% from 79 cents in the prior-year period [3] - Net sales and other revenues reached $18,339.5 million, up 0.4% year over year, but missed the consensus estimate of $18,401 million [3] - Identical sales rose by 1%, driven by strong pharmacy sales, although this was partially offset by declines in fuel sales and wholesale revenues [3] Profitability Metrics - Gross profit was $5,144.2 million, an increase of 1.2% year over year, with gross margin expanding by 20 basis points to 28.0% [3] - Excluding fuel and LIFO expenses, gross margin decreased by 58 basis points year over year due to lower margins in pharmacy operations and increased shrink [4] - Selling and administrative expenses decreased by 0.1% to $4,717.2 million, with the expense rate declining by 10 basis points to 25.7% of net sales [4][5] Operational Challenges - Adjusted EBITDA declined by 12.8% year over year to $915.8 million, with the adjusted EBITDA margin contracting by 100 basis points [5] - Higher operating expenses related to digital and omni-channel development, merger-related costs, and increased store occupancy costs contributed to the challenges [5] Balance Sheet Overview - As of February 24, 2024, ACI had cash and cash equivalents of $188.7 million, long-term debt and finance lease obligations totaling $7,783.4 million, and total stockholders' equity of $2,747.5 million [6]

Core Viewpoint - Kroger and Albertsons are increasing the number of grocery stores sold to C&S Wholesale Grocers to address federal regulators' concerns regarding their proposed $25 billion merger, now involving the sale of an additional 166 stores [1][2]. Group 1: Updated Divestiture Agreement - The updated divestiture agreement will see C&S pay approximately $2.9 billion in cash for the stores, an increase from the original $1.9 billion payout [1]. - The new agreement will result in C&S acquiring a total of 579 stores, along with access to the Albertsons Signature and O Organics private label brands [1]. Group 2: Regulatory and Employment Commitments - Kroger's CEO emphasized that the updated plan ensures no store closures due to the merger, all frontline associates will remain employed, and existing collective bargaining agreements will continue [2][4]. - The agreement aims to maintain industry-leading healthcare and pension benefits for associates, alongside bargained-for wages [4]. Group 3: C&S Wholesale Grocers' Perspective - C&S Wholesale Grocers' CEO expressed confidence that the expanded divestiture package will provide the necessary resources for the stores to continue serving their communities effectively [4]. - C&S looks forward to integrating storied banners, quality private label brands, and experienced retail associates into its operations [4]. Group 4: Legal and Market Concerns - The Federal Trade Commission (FTC) and eight states have filed a lawsuit to block the merger, citing concerns over potential price increases, store closures, and job losses in the grocery market [6]. - Union representatives have raised concerns about C&S's ability to maintain store operations without adequate IT infrastructure and customer loyalty [8].

As ongoing financial challenges have grocery shoppers more cautious about their purchasing, many are seeking out digital rewards. In its fourth quarter and full year fiscal 2023 financial results, Albertsons Companies shared that increases in digital engagement led its growth, with identical sales up only 1% year over year in Q4 but digital sales up 24%. Central to this growth was the chain’s loyalty program, which saw its membership grow by 16% to nearly 40 million.“We delivered another solid quarter amids ...

Core Insights - Albertsons and Kroger are divesting more locations to secure regulatory approval for Kroger's $24.6 billion acquisition of Albertsons [1] - The revised divestiture agreement with C&S Wholesale Grocers includes the sale of 160 additional locations, bringing the total to 579 [1] - The Federal Trade Commission (FTC) previously deemed the initial divestiture plan inadequate [1] Financial Performance - Albertsons reported fourth-quarter adjusted earnings per share (EPS) of $0.54, surpassing estimates [1] - Revenue for Albertsons increased by 0.4% to $18.34 billion, which fell short of forecasts [1] - CEO Vivek Sankaran indicated that the company faces ongoing challenges, including rising associate wages, prior year food inflation, and declining COVID-related income [1] Market Reaction - Albertsons shares declined by 0.4% to $20.26, with a nearly 12% drop year-to-date [1] - Kroger shares remained stable but have increased by approximately 24% in 2024 [1]

Core Insights - Albertsons Companies, Inc. reported revenue of $18.34 billion for the quarter ended February 2024, reflecting a year-over-year increase of 0.4% [1] - The earnings per share (EPS) for the same period was $0.54, down from $0.79 a year ago [1] - The reported revenue was slightly below the Zacks Consensus Estimate of $18.4 billion, resulting in a surprise of -0.33% [1] - The company did not deliver an EPS surprise, as the consensus EPS estimate was also $0.54 [1] Key Performance Metrics - Same-store sales increased by 1%, matching the four-analyst average estimate of 1% [2] - The number of stores at the end of the quarter was 2,269, slightly below the average estimate of 2,271 from three analysts [2] - Total retail square footage was 112.8 million, compared to the average estimate of 112.9 million based on two analysts [2] - Revenue from fuel sales was $822.80 million, below the average estimate of $902.34 million from two analysts [2] Stock Performance - Shares of Albertsons Companies have returned -2.6% over the past month, compared to a -4% change in the Zacks S&P 500 composite [2] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [2]