Goldman Sachs Restarts Coverage on Safeway and Kroger as “Buys” (SWY, KR)

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Analysts at Goldman Sachs on Wednesday restarted coverage on supermarket operators Safeway Inc. ( SWY ) and The Kroger Co. ( KR ) with a "Buy" rating on both.

The firm set a $25 price target on SWY, which implies a 19% upside to the stock's Tuesday closing price of $20.93. Goldman cited solid near-near-term fundamentals and an attractive valuation for the positive view, noting the company's Blackhawk subsidiary could be a catalyst to push the stock higher.

Meanwhile, the analyst also set a $25 price target on Kroger (19% upside), citing an attractive risk/reward scenario. Goldman said KR has an attractive valuation and cited lower deflation as a potential catalyst.

Both Safeway and Kroger shares were mostly flat in premarket trading Wednesday.

The Bottom Line
Shares of Safeway ( SWY ) have a 2.29% dividend yield, based on last night's closing stock price of $20.93.
Shares of Kroger ( KR ) have a 2.00% dividend yield, based on last night's closing stock price of $21.00.

Safeway Inc. ( SWY ) and The Kroger Co. ( KR ) are both rated "Neutral," holding Dividend.com DARS™ Ratings of 3.2 and 3.3 out of 5 stars, respectively.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Stocks

Referenced Stocks: SWY

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