Kroger's quarterly profit and sales rise and beat estimates, and the largest U.S. supermarket chain issues an upbeat forecast. Fred Katayama reports.
Cutting prices lured more customers to Kroger's stores, helping the largest U.S. supermarket chain ring up higher quarterly sales and profit. Sales at established stores also rose and beat analysts' estimates. Kroger's supermarket chains include Ralph's, Harris Tweeter and Food 4 Less. They've been slashing prices to take on rivals such as Wal-Mart Stores, German discounters Aldi and Lidl, and Amazon, which cut prices at the upscale chain it recently acquired, Whole Foods. Pivotal Research senior analyst Ajay Jain said, "Our key takeaway is that Kroger appears to be executing very well ... However, it's also clear that the competitive environment is intensifying." Looking ahead, Kroger was upbeat. It expects same-store sales to grow more than 1.1 percent in the current quarter. And it says record sales at Fred Meyer helped it achieve its best Black Friday results ever. Investors liked what they heard and went shopping for Kroger's battered stock, pushing it up sharply higher at the market open Thursday. The stock has lost nearly a third of its value this year.