Is The Kroger Co. overvalued or undervalued?

As of 11 September 2025, the valuation grade for The Kroger Co. has moved from very expensive to fair. Based on the current metrics, the company appears to be fairly valued. The P/E ratio stands at 37, while the EV to EBITDA ratio is 15.73, and the Price to Book Value is 14.74, indicating that the stock is priced in line with its earnings and asset value relative to its peers.
In comparison to its peers, The Kroger Co. has a P/E ratio of 39.10, which is slightly higher than its current valuation, suggesting it is not significantly overvalued. Notably, its ROCE of 23.54% and ROE of 39.34% reflect strong operational efficiency and profitability. While the stock has underperformed the S&P 500 over the 3-year and 10-year periods, it has outperformed the index year-to-date and over the past year, with returns of 7.91% and 20.82%, respectively. This mixed performance underscores the need for cautious optimism regarding its valuation.