Shares of Kroger Co. KR, -10.21% dropped 5.5% in premarket trade Thursday, after the supermarket chain reported fiscal second-quarter earnings that beat expectations, but sales that came up short. Net income rose to $508 million, or 62 cents a share, from $353 million, or 39 cents a share, in the same period a year ago. Excluding non-recurring items, adjusted earnings per share came in at 41 cents, above the FactSet consensus of 38 cents. Sales increased to $27.87 billion from $27.60 billion, just missing the FactSet consensus of $27.93 billion, as identical-store sales growth of 1.6% was below expectations of a 1.8% rise. Looking ahead, the company raised its net EPS guidance range to $3.88 to $4.03 from $3.64 to $3.79, but affirmed its adjusted EPS outlook of $2.00 to $2.15. Kroger expects full-year identical sales growth of 2.0% to 2.5%, compared with the FactSet consensus of 2.0%. The stock had run up 22% over the past three months through Wednesday, while the SPDR S&P Retail ETF XRT, -0.04% had gained 4.8% and the S&P 500 SPX, +0.56% had tacked on 4.1%.
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