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Omar Venerio
Omar Venerio
Articles (1681) 

Thursday Morning Market Highlights

Wall Street mixed, Kroger shares fall despite earning beat

US markets

U.S. stocks were in the red overall on Thursday ahead of rising Covid-19 cases and higher unemployment across the U.S. The Dow Jones Industrial Average fell 0.19% to 26,070 and the S&P 500 index lost 0.10% to 3,110, but the Nasdaq Composite Index was up 0.13% to 9,923.


• Waters Corp​ (NYSE:WAT) +6.2%

• HollyFrontier Corp (NYSE:HFC) +5.3%

• Occidental Petroleum Corp (NYSE:OXY) +6.1%

• Marathon Petroleum Corp​ (NYSE:MPC) +4.6%

• Phillips 66 (NYSE:PSX) +4.5%

• Valero Energy Corp (NYSE:VLO) +4.1%


• Arista Networks Inc (NYSE:ANET) -2.8%

• Extra Space Storage Inc (NYSE:EXR) -2.1%

• Public Storage (NYSE:PSA) -2.3%

• Alliance Data Systems Corp (NYSE:ADS) -2.5%

• Iron Mountain Inc (NYSE:IRM) -3%

Global markets

The main European stock markets traded in the red. The UK's FTSE 100 fell 0.62%, France's CAC 40 retreated 1.35%, Germany's Dax was down 1.22% and Spain's Ibex 35 lost 1.50%.

In Asia, Japan's Nikkei 225 slid 0.45%, India’s BSE Sensex gained 2.09%, Hong Kong's Hang Seng dipped 0.07% and China's Shanghai Composite was up 0.12%.

Kroger releases earnings report

Shares of The Kroger Co. (NYSE:KR) fell 4% on Thursday morning after the company announced its first-quarter results the previous day. It posted a gain of $1.22 per share, beating analysts’ estimates by 8 cents. Revenue of $41.55 billion grew 11.5% year-over-year and beat expectations by $630 million.

CEO Rodney McMullen had the following to say:

“Under Restock Kroger, we have made significant investments over the last several years to establish a seamless digital ecosystem, strengthen Our Brands and our personalization capabilities, and to enhance product freshness and quality. These investments helped Kroger deliver improved results in 2019, a strong start to the quarter, and very much came to the forefront as we provided our customers with the fresh food and essentials they have needed during the pandemic.”

Excluding fuel and dispositions, sales increased 19.1%. Kroger reported net income of $1.21 billion, or $1.22 per share on an adjusted basis, topping analysts' expectations.

Despite the good results, shares fell 4% to $31.46 in Thursday morning. However, the grocery giant's shares have added more than 13% since the beginning of the year.

Digital sales almost doubled, up 92% compared with the previous quarter increase of 22%. The gross margin reached 24.3% of sales.

Looking ahead the full year 2020, the company's original expectation was comps growth of at least 2.2% and earnings per share between $2.30 and $2.40. Though it has not provided new projections, the company said it expects to exceed those figures.

Ray Dalio (Trades, Portfolio) initiated a new positon in the company worth 42,253 shares. Jim Simons' Renaissance Technologies added 43% to its investment for a total of 12,969,303 shares and Paul Tudor Jones (Trades, Portfolio) added 25,203 shares. Richard Snow (Trades, Portfolio) sold out the stock.

Disclosure: The author holds no positions in any stocks mentioned.

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About the author:

Omar Venerio
Omar Venerio is a capital markets, derivatives, corporate finance and financial management professor and Area Head of Finance. He is passionate about the stock market and providing independent fundamental research and hedge fund and insider trading-focused investigation.

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