Insider Activity Update: Timothy A Massa Executes Options Exercise, Resulting In $531K At Kroger

A large exercise of company stock options by Timothy A Massa, Senior Vice President at Kroger KR was disclosed in a new SEC filing on April 24, as part of an insider exercise.

What Happened: The latest Form 4 filing on Wednesday with the U.S. Securities and Exchange Commission uncovered Massa, Senior Vice President at Kroger, exercising stock options for 29,970 shares of KR. The total transaction was valued at $531,967.

During Thursday's morning session, Kroger shares down by 0.12%, currently priced at $56.08. Considering the current price, Massa's 29,970 shares have a total value of $531,967.

Unveiling the Story Behind Kroger

Kroger is one of the largest grocery retailers in the United States with more than 2,700 stores across a portfolio of over 20 supermarket banners. The company touts its ingrained position across US communities, citing that it is a top-two grocer in most of its major market areas. Over one fourth of Kroger's roughly $110 billion in nonperishable and fresh food sales (about 75% of revenue) stems from its private-label portfolio, of which the company manufactures about 30% of units via its 33 food production plants. The firm also operates fuel stations and pharmacies at 60% and 80% of its locations, respectively.

Unraveling the Financial Story of Kroger

Revenue Growth: Kroger's remarkable performance in 3 months is evident. As of 31 January, 2024, the company achieved an impressive revenue growth rate of 6.44%. This signifies a substantial increase in the company's top-line earnings. In comparison to its industry peers, the company stands out with a growth rate higher than the average among peers in the Consumer Staples sector.

Interpreting Earnings Metrics:

• Gross Margin: The company faces challenges with a low gross margin of 22.72%, suggesting potential difficulties in cost control and profitability compared to its peers.

• Earnings per Share (EPS): The company excels with an EPS that surpasses the industry average. With a current EPS of 1.01, Kroger showcases strong earnings per share.

Debt Management: The company faces challenges in debt management with a debt-to-equity ratio higher than the industry average. With a ratio of 1.66, caution is advised due to increased financial risk.

Financial Valuation Breakdown:

• Price to Earnings (P/E) Ratio: A higher-than-average P/E ratio of 18.97 suggests caution, as the stock may be overvalued in the eyes of investors.

• Price to Sales (P/S) Ratio: With a P/S ratio of 0.27 below industry standards, the stock shows potential undervaluation, making it an appealing investment option for those focusing on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio lower than industry benchmarks at 8.06, Kroger presents an attractive value opportunity.

Market Capitalization Analysis: With a profound presence, the company's market capitalization is above industry averages. This reflects substantial size and strong market recognition.

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Illuminating the Importance of Insider Transactions

Insider transactions are not the sole determinant of investment choices, but they are a factor worth considering.

When discussing legal matters, the term "insider" refers to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, as stipulated in Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are required to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.

A new purchase by a company insider is a indication that they anticipate the stock will rise.

On the other hand, insider sells may not necessarily indicate a bearish view and can be motivated by various factors.

The Insider's Guide to Important Transaction Codes

Digging into the details of stock transactions, investors frequently turn their attention to those taking place in the open market, as outlined in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C signals the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Kroger's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.