Grocery stores are very competitive and have a low margin business, but there are some standout companies that produce good dividends and have rewarded long time shareholders with nice capital gains. Here are some good grocery chain stocks.
While WMT (Walmart Stores Inc) is not a pur play on groceries, it qualifies as one of the biggest grocery chains in the US. It also has operations in many emerging markets, and developed markets. It is the world's largest retailer and employs 1.9 million associates around the world. It pays a nice dividend and has a reputation for increasing the dividend every year.
Supervalu (SVU) is a turnaround story. The company hired an executive from Walmart Stores Inc, to help develop its brand and to increase the value side of the business. SVU pays a healthy dividend, and free cash flow supports the dividend. The companies vast real-estate holdings are also undervalued by its stock price. The company does suffer from sliding sales revenue, and has some additional risk as a result.
The Kroger Company (KR) is a diversified company that similar to Walmart Stores Inc. is not a pure play on groceries. It has department store like chains such as Fred Meyer, but it also operates many pure grocery stores like flagship Kroger stores and Food-4-Less. The company resumed paying dividends in 1996 and has been increasing the yield steadily with earnings.
Whole Foods (WFMI) is an upscale grocer that specializes in organic and healthier foods. The company operates with a mentality towards more equitable treatment for food producers, associates and management. The company pays a fair wage to its employees and limits management salaries to a multiple of the lowest paid worker. The company also pays a nice dividend that has been increasing every year since 2004.
The Fresh Market is a growth play. It operates in 19 states, and has just shy of 100 stores. It operates similar to a Whole Foods with more emphasis on healthy foods. The stock does not currently pay a dividend, and is a recent addition the Nasdaq, but it looks like a good growth opportunity.
This list is for entertainment purposes. Please read the prospectus for each of these stocks before investing. The author is long Wal-Mart and Supervalu common stock.
nice list!
Informative list of grocery stocks. h5
select one here...