Even If Its Pursuit of Albertsons Falters, Kroger Should Continue To Capitalize on Its Advantages

Of the traditional grocers, we believe Kroger is uniquely positioned to defend its returns against a competitive onslaught that should intensify as Amazon, mass merchandisers, and hard discounters price aggressively to boost volume. Industry factors are diminishing its competitive standing, but we contend that Kroger still benefits from enduring intangible assets and cost advantages (even if its acquisition of Albertsons is derailed by regulators).