- Kroger stock closed at $47.92 with an increase of +0.25% during the last intraday session.
- KR price was in a bullish trend but recently received a pullback.
KR stock price gained bullish momentum during the start of march after forming a low at $43. The stock price surged 16% from the low in the month of march creating a high at $50 level. The price reached $46.30 to form a support and started its recovery phase after falling 7% from the high.
Kroger is making investment in improving the product freshness, quality and expanding digital capabilities. There is a new introduction of items under ‘our brands’ section. Big news for Kroger is around the merger with albertsons. Kroger, the largest supermarket chain in the United states and second largest retailer only behind Walwart decided to merge with Albertsons, the second largest supermarket company in the united states. These two firms majorly own more than 5000 stores in the US. They are looking to consolidate grocery industry by joining forces in a $24.6 billion merger.
There is opposition from labor unions, city officials, advocacy groups for stopping the merger as it will create a monopoly in the market leading to super stores being closed, thousands of lost jobs as well as higher food prices. There is a big correlation between a big merger and increased prices. This would be devastating for the farmers, consumers and workers.
The merger will take time and is not expected to be completed before 2024. The main reason for the merger is to compete better with the supermarket giants, Walmart and Costco as after merger they can position themselves better. Kroger CEO stated that the savings provided by the deal would help them in cutting prices for the consumers which is the major concern if the merger leads to monopoly in the market.
Kroger Technical Analysis:
The RSI is around 51.74 indicating price is in neutral territory with the same pressure from bulls as well as bears. The stock showed some bullishness after reaching the support level of $46.60 and is aimed for $50 price level. The kroger price reached the lower band of bollinger and started to rise and is currently rejecting the 20 day SMA of bollinger indicating bearish sentiment still resides in the market. +DI crossed the -DI positively, with an ADX of 17.06.
Conclusion:
The overall financial health of Kroger is pretty strong. The profit margin for Kroger increased for previous as in 2021 it was at 1.19% and for 2022 it reached to 1.50%. Even though it is below the industry average of 2.21%. Since 2018 the profit margin is decreasing for kroger.
The market structure and price action shows signs of bullishness in the price and is currently headed towards the immediate resistance as well as three month highs of $50. The technical parameters started to turn bullish slowly. Whether the merger would be good or bad for the public, the stock price did not sustain the bullishness and fell below the March 22 price level.
Technical Levels:
Major support: $43 and $46.60
Major resistance: $50 and $52.
Disclaimer
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