Overview
BMO Capital has reiterated its Market Perform rating and retained a $70.00 price target on Kroger (NYSE:KR) following the company’s appointment of Greg Foran as chief executive officer, effective immediately. The grocery operator, with a market capitalization of $45.36 billion, has seen its stock rise 7.04% over the past week and was trading near $71.64 as investors responded to the leadership change.
Leadership change and market reaction
The appointment of Foran follows almost one year in which the company sought a permanent CEO. Foran’s prior roles include serving as CEO of Air New Zealand from 2020 to 2025 and as CEO of Walmart U.S. from 2014 to 2019, where he was credited with improving store execution and launching major store-level wage investments. BMO notes that Foran had been mentioned by investors as a favorable candidate during the search, though the firm said his selection was not widely anticipated. Given his record at Walmart U.S., BMO expects a positive reaction in Kroger’s share price tied to the news.
Corporate governance
Ron Sagent, who served as interim CEO, will remain on the board as Chairman of Kroger. Under Sagent’s interim leadership, the company refreshed its e-commerce strategy over the past year. Later in the company’s announcement materials, the chairman’s name appears as Ron Sargent, with sources indicating he will continue as Chairman of the Board - reflecting both spellings provided in company communications.
Analyst context and valuation range
Data from InvestingPro indicates Kroger is trading slightly below its assessed Fair Value, with analyst price targets spanning from $64 to $85. In addition to BMO’s reiteration, Evercore ISI raised its price target on Kroger to $84 from $77, while keeping an Outperform rating.
Operational and financial metrics highlighted by BMO
- BMO’s analysis shows Kroger’s grocery market share has underperformed over the last seven quarters by an average of 50 basis points.
- Despite market share headwinds, Kroger’s core gross margin has expanded by 40-50 basis points across the last three fiscal years.
- The company posts a gross profit margin of 24.02% and yields 2.07% on its dividend, having increased its dividend for 20 consecutive years according to InvestingPro.
Recent corporate actions and shareholder returns
Kroger declared a quarterly dividend of $0.35 per share, payable on March 1, 2026, to shareholders of record as of February 13, 2026. The company’s quarterly dividend has grown at a compounded annual growth rate of 13% since 2006, as reported in InvestingPro data.
Strategic developments in delivery and e-commerce
To broaden delivery reach, Kroger has expanded its partnership with Uber Eats and Postmates, offering grocery delivery from nearly 2,700 stores nationwide. Through these platforms, customers can order the full product assortment from Kroger’s retail banners, including Ralphs and Fred Meyer.
Takeaway
BMO’s decision to hold the Market Perform rating and $70.00 target reflects a measured view on Kroger’s near-term prospects following the appointment of a CEO with a strong retail background. The market has reacted positively to the leadership change, while analysts remain split across a range of price targets. The company’s margin improvements and dividend track record stand alongside ongoing market share challenges and the operational focus on expanding delivery and e-commerce capabilities.
Key points
- Greg Foran appointed CEO effective immediately; shares rose about 7.04% over the past week as investors responded to the news - impact: Retail and equities markets.
- BMO Capital maintained a Market Perform rating with a $70.00 price target; analysts’ targets span $64 to $85, indicating varied views on valuation - impact: Equity research and investor sentiment.
- Kroger continues to invest in delivery and e-commerce partnerships while paying a 2.07% dividend and sustaining a long history of dividend increases - impact: Income investors and retail operations.
Risks and uncertainties
- Market share underperformance - BMO notes Kroger’s grocery share has lagged by an average of 50 basis points over the last seven quarters, a risk for top-line momentum in the grocery sector.
- Name inconsistency in leadership references - communications show the chairman’s name as both Ron Sagent and Ron Sargent, an ambiguity present in company materials that may complicate public messaging.
- Valuation dispersion among analysts - price targets ranging from $64 to $85 reflect uncertainty about near-term execution and the company’s ability to translate leadership change into sustainable gains, affecting investor expectations in the retail and consumer staples sectors.