Investors were clear about their perception of the second-quarter earnings results that Kroger (NYSE: KR) reported last week — they didn’t like them. Shares fell 7.5% on Friday in response to last quarter’s shrinking gross margin, and have since given up a bit more ground. Rising wholesale costs and (of all things) theft are taking a toll.
This pullback, however, is ultimately a buying opportunity. Last quarter’s cost increase is not only out of the ordinary, but it’s projected to be temporary.
Image source: Getty Images.