Head to Head Comparison: Kroger Company (The) (KR) versus Performance Food Group (PFGC)

Kroger Company (The) (NYSE: KR) and Performance Food Group (NYSE:PFGC) are both mid-cap retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, analyst recommendations, earnings, valuation, institutional ownership, dividends and profitability.

Profitability

This table compares Kroger Company (The) and Performance Food Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kroger Company (The) 1.32% 28.04% 4.94%
Performance Food Group 0.57% 14.73% 3.48%

Dividends

Kroger Company (The) pays an annual dividend of $0.50 per share and has a dividend yield of 2.4%. Performance Food Group does not pay a dividend. Kroger Company (The) pays out 30.3% of its earnings in the form of a dividend. Kroger Company (The) has increased its dividend for 8 consecutive years.

Insider & Institutional Ownership

75.8% of Kroger Company (The) shares are held by institutional investors. Comparatively, 78.7% of Performance Food Group shares are held by institutional investors. 0.9% of Kroger Company (The) shares are held by insiders. Comparatively, 3.7% of Performance Food Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Volatility & Risk

Kroger Company (The) has a beta of 0.76, suggesting that its share price is 24% less volatile than the S&P 500. Comparatively, Performance Food Group has a beta of -0.27, suggesting that its share price is 127% less volatile than the S&P 500.

Earnings and Valuation

This table compares Kroger Company (The) and Performance Food Group’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Kroger Company (The) $118.05 billion 0.15 $5.56 billion $1.65 12.44
Performance Food Group $16.76 billion 0.17 $342.30 million $0.93 30.00

Kroger Company (The) has higher revenue and earnings than Performance Food Group. Kroger Company (The) is trading at a lower price-to-earnings ratio than Performance Food Group, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations for Kroger Company (The) and Performance Food Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kroger Company (The) 1 15 8 0 2.29
Performance Food Group 0 6 5 0 2.45

Kroger Company (The) currently has a consensus target price of $28.82, suggesting a potential upside of 40.37%. Performance Food Group has a consensus target price of $29.00, suggesting a potential upside of 3.94%. Given Kroger Company (The)’s higher probable upside, equities analysts clearly believe Kroger Company (The) is more favorable than Performance Food Group.

Summary

Kroger Company (The) beats Performance Food Group on 11 of the 17 factors compared between the two stocks.

About Kroger Company (The)

The Kroger Co. (Kroger) manufactures and processes food for sale in its supermarkets. The Company operates supermarkets, multi-department stores, jewelry stores and convenience stores throughout the United States. As of January 28, 2017, it had operated approximately 4,000 owned or leased supermarkets, convenience stores, fine jewelry stores, distribution warehouses and food production plants through divisions, subsidiaries or affiliates. These facilities are located throughout the United States. As of January 28, 2017, Kroger operated, either directly or through its subsidiaries, 2,796 supermarkets under a range of local banner names, of which 2,255 had pharmacies and 1,445 had fuel centers. As of January 28, 2017, the Company offered ClickList and Harris Teeter ExpressLane, personalized, order online, pick up at the store services at 637 of its supermarkets. P$$T, Check This Out and Heritage Farm are the three brands. Its other brands include Simple Truth and Simple Truth Organic.

About Performance Food Group

Performance Food Group Company, through its subsidiaries, markets and distributes food and food-related products. The Company operates through three segments: Performance Foodservice, PFG Customized and Vistar. The Performance Foodservice segment distributes a range of national brands, customer brands, and branded food and food-related products. It sells to independent or street, and multi-unit or chain, restaurants and other institutions. Its PFG Customized segment provides service to family and casual dining restaurant chains, and fast casual and quick service restaurant chains. Its Vistar segment specializes in distributing candy, snacks, beverages and other items nationally to the vending, office coffee service, theater, hospitality and other channels. Its products include a range of frozen foods, such as meats, fully prepared appetizers and entrees, and desserts; a range of canned and dry foods; fresh meats; dairy products; beverage products, and snack and other products.

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