Comparing Axfood AB (publ) (OTCMKTS:AXFOY) and Kroger (NYSE:KR)

Kroger (NYSE:KR) and Axfood AB (publ) (OTCMKTS:AXFOY) are both retail/wholesale companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, risk, analyst recommendations, profitability, earnings, institutional ownership and valuation.

Dividends

Kroger pays an annual dividend of $1.28 per share and has a dividend yield of 2.1%. Axfood AB (publ) pays an annual dividend of $4.91 per share and has a dividend yield of 19.5%. Kroger pays out 33.5% of its earnings in the form of a dividend. Axfood AB (publ) pays out 48.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Kroger has raised its dividend for 19 consecutive years.

Institutional & Insider Ownership

80.9% of Kroger shares are owned by institutional investors. 1.4% of Kroger shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Kroger and Axfood AB (publ)’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kroger	1.86%	28.54%	6.66%
Axfood AB (publ)	N/A	N/A	N/A

Analyst Recommendations

This is a summary of recent ratings and target prices for Kroger and Axfood AB (publ), as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kroger	0	4	7	1	2.75
Axfood AB (publ)	0	0	0	0	0.00

Kroger currently has a consensus price target of $60.09, indicating a potential upside of 0.30%. Given Kroger’s stronger consensus rating and higher possible upside, research analysts clearly believe Kroger is more favorable than Axfood AB (publ).

Earnings and Valuation

This table compares Kroger and Axfood AB (publ)”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kroger	$150.04 billion	0.29	$2.16 billion	$3.82	15.68
Axfood AB (publ)	N/A	N/A	N/A	$10.22	2.47

Kroger has higher revenue and earnings than Axfood AB (publ). Axfood AB (publ) is trading at a lower price-to-earnings ratio than Kroger, indicating that it is currently the more affordable of the two stocks.

Summary

Kroger beats Axfood AB (publ) on 13 of the 15 factors compared between the two stocks.

About Kroger

The Kroger Co. operates as a food and drug retailer in the United States. The company operates combination food and drug stores, multi-department stores, marketplace stores, and price impact warehouses. Its combination food and drug stores offer natural food and organic sections, pharmacies, general merchandise, pet centers, fresh seafood, and organic produce; and multi-department stores provide apparel, home fashion and furnishings, outdoor living, electronics, automotive products, and toys. The company’s marketplace stores offer full-service grocery, pharmacy, health and beauty care, and perishable goods, as well as general merchandise, including apparel, home goods, and toys; and price impact warehouse stores provide grocery, and health and beauty care items, as well as meat, dairy, baked goods, and fresh produce items. It also manufactures and processes food products for sale in its supermarkets and online; and sells fuel through fuel centers. The Kroger Co. was founded in 1883 and is based in Cincinnati, Ohio.

About Axfood AB (publ)

Axfood AB (publ) engages in the food retail and wholesale businesses primarily in Sweden. It operates through four segments: Willys, Hemköp, Dagab, and Snabbgross. The company sells groceries through Willys, HANDLAR'N, Hemköp, and Eurocash store chains. It is also involved in the e-commerce business; and provision of private label products. In addition, it offers home delivery of meal kits under the Middagsfrid name, as well as operates Urban Deli, a combination of restaurant and market hall; Apohem, an online retail pharmacy; Matöppe, a personal grocery store and the retailer-owned mini-mart; Snabbgriss, a restaurant; and Tempo, a mini-mart format of retailer-owned stores. The company serves restaurants, fastfood operators, and cafés; and retailer-owned stores, mini-marts, and other convenience retailers. Axfood AB (publ) was founded in 1958 and is headquartered in Stockholm, Sweden. Axfood AB (publ) operates as a subsidiary of Axretail AB.