Kroger Stock Could Double: Analyst

Bill Priest, CEO of Epoch Investment Partners (New York), told the Barron’s 2018 Mid-Year Roundtable that he thought it was likely that The Kroger Co.’s (Cincinnati) stock could double by 2020.

Priest noted Kroger’s strategic investment in its e-commerce capabilities as his primary reasoning – most notably the grocer’s investment in British grocery delivery company Ocado. Kroger plans to add automated warehouses in the U.S. by teaming up with Ocado, reports the Cincinnati Business Courier.

The analyst also noted Kroger’s plan to return $6 billion to shareholders, representing a quarter of its market share. He says he expects the company will generate and use roughly $15 billion in operating cash flow over the next three years, which it will use to buy back stock.

If Kroger shares double, they would reach more than $50 per share, the highest they've ever been. The highest its stock has been was $42.75 per share, set in 2015. Yesterday the company’s stock closed at $27.99.

Epoch Investment Partners owns Kroger stock, though it has not disclosed how many shares.