Kroger stock holds steady as UBS maintains Neutral rating on improved execution

Investing.com - UBS maintained its Neutral rating and $74.00 price target on Kroger (NYSE:KR), a retail giant with $147 billion in revenue, following the retailer’s second-quarter results, which demonstrated improving business momentum alongside some continuing risks. According to InvestingPro data, the stock is currently trading near its Fair Value with a Good financial health rating.

The grocery chain reported its sixth consecutive quarter of sequential acceleration in identical store sales excluding fuel. Kroger also saw growth acceleration across its e-commerce, retail media, and pharmacy segments.

UBS noted that Kroger’s leadership is taking proactive measures to stabilize the business while the company searches for a permanent CEO. These initiatives include simplifying its value proposition and implementing cost-cutting measures where necessary.

The retailer is deploying artificial intelligence tools to improve efficiency and modernize operations, according to UBS. Kroger is also conducting a strategic review of both its sourcing model and e-commerce business.

UBS believes these steps have the potential to establish a foundation for sustainable growth at Kroger, though the firm maintained its neutral stance on the stock with the $74.00 price target.

In other recent news, Kroger has reported its second-quarter earnings for 2025, exceeding analyst expectations with an adjusted earnings per share (EPS) of $1.04, compared to the projected $0.99. Despite a slight revenue miss, the company’s strategic initiatives and positive sales growth have contributed to a positive outlook among investors. BMO Capital has maintained its Market Perform rating on Kroger, with a price target of $70, following the company’s better-than-expected fiscal second-quarter 2026 results. The research firm highlighted that strong pharmacy trends are driving most of the identical store sales growth, although grocery unit growth remains negative. These developments reflect continued investor interest and analyst attention on Kroger’s performance and strategic direction.

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