Wall Street’s view on SUPERVALU
A total of ten Wall Street analysts track SUPERVALU stock. The company is rated a 2.5 on a scale of 1 (“strong buy”) to 5 (“sell”). 70% of analysts recommend “holds” the stock, while 30% recommend “buys.” There have been no “sell” recommendations on the stock since August 2015.
Telsey Advisory Group, Morgan Stanley, and Deutsche Bank are among the brokers that recommend “holds” on SVU, while Pivotal Research and RBC Capital have suggested “buys” on the stock. There have been no ratings changes on SVU since its fiscal 1Q18 results release. In fact, its ratings haven’t changed for the past year and a half.
Supermarket chains Kroger (KR) and Whole Foods Market (WFM) have lower ratings compared to SUPERVALU. The two companies are rated 2.9 and 3.0, respectively. While Whole Foods has 4% “sell” and 83% “hold” recommendations, Kroger has 56% “hold” and 8% “sell” recommendations.
A look at valuations
SUPERVALU continues to be the cheapest among its peers. The company is currently trading at a one-year forward price-to-earnings ratio (or PE) of 11.3x. Kroger (KR) has a PE of 11.9x, Whole Foods Market (WFM) has a PE of 30.6x, United Natural Foods (UNFI) has a PE of 14.5x, and Sysco (SYY) has a PE of 19.7x.
It should be noted that SVU is trading at the upper end of its valuation range of 6.8x–12.1x.
ETF investors seeking to add exposure to SVU can consider the WisdomTree SmallCap Earnings ETF (EES), which invests 0.4% of its portfolio in the company.