Kroger raises quarterly dividend by 9% to 35 cents per share

CINCINNATI - Kroger Co. (NYSE:KR), the $47.8 billion grocery retail giant whose stock has surged over 10% in the past week, announced Thursday that its Board of Directors approved a 9% increase in the company’s annual dividend from $1.28 to $1.40 per share, bringing the yield to approximately 1.77%.

The next quarterly dividend of 35 cents per share will be paid on September 1, 2025, to shareholders of record as of August 15, 2025, according to a company press release.

This marks the 19th consecutive year of dividend increases for the grocery retailer. Since reinstating its dividend in 2006, Kroger’s quarterly dividend has grown at a 13% compounded annual growth rate.

"This dividend increase reflects the Board of Directors’ confidence in the consistency of our operating performance, strength of our free cash flow generation, and our commitment to deliver long-term shareholder value," said Ron Sargent, Kroger’s Chairman and CEO.

Kroger’s capital allocation strategy focuses on using free cash flow to invest in business growth while maintaining its investment grade debt rating and returning capital to shareholders.

The company operates nearly 410,000 associates serving over 11 million customers daily through various banner names across America. Kroger stated it expects to continue increasing its dividend over time, subject to board approval.

In other recent news, Kroger reported its first-quarter earnings for 2025, showcasing earnings per share (EPS) of $1.49, surpassing analyst expectations of $1.45. Despite a slight miss on revenue, with $45.12 billion reported against a forecast of $45.28 billion, the company’s strategic initiatives in e-commerce and private label brands have shown resilience. Analysts from Telsey Advisory Group raised their price target for Kroger to $82.00, citing strong execution and digital capabilities, while maintaining an Outperform rating. Citi also increased its price target to $74.00, acknowledging Kroger’s robust first-quarter performance and comparable sales growth of 3.2%, which exceeded expectations.

UBS and Morgan Stanley have both adjusted their price targets for Kroger to $74.00 and $76.00, respectively, with both firms maintaining neutral ratings. UBS noted improvements in Kroger’s profitability management and e-commerce operations, while Morgan Stanley cited the company’s accelerating top-line growth. Kroger’s fiscal 2025 guidance has been revised, indicating an increase in identical sales guidance to 2.25%-3.25%, reflecting the company’s positive momentum. Kroger plans to close 60 stores but is set to accelerate new store openings in 2026, demonstrating a strategic focus on optimizing its store network. The company continues to navigate a challenging retail environment with a strong focus on digital expansion and customer loyalty initiatives.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.