Kroger Stock’s 0.7% Dip Matches Dividend, Muting 19 Million-Egg Recall Signal

Midwest Poultry Services has pulled white-shell and brown cage-free eggs made at a pair of Texas facilities after environmental tests suggested a potential risk of Salmonella Enteritidis. As of Wednesday, there were no reports of illness connected to the eggs.

Kroger Co is picking up Giant Eagle for what looks like a cheap price compared to the revenue involved. The bigger question for investors is if the chain can use that low multiple to boost margins in two grocery markets where Walmart Inc is already a strong rival.

Kroger agreed to buy family-owned Giant Eagle for $1.65 billion, a small but targeted bet on Pittsburgh, northern Ohio and nearby grocery markets after its larger Albertsons Companies plan died in court. The buyer is paying $1.25 billion in cash and assuming about $400 million of Giant Eagle liabilities, Kroger said. Giant Eagle has about $9 billion in annual sales, 197 supermarkets and 11 standalone pharmacies.

Kroger Co faces a contained but useful supply-chain test after U.S. food-safety officials warned consumers about a mislabeled Private Selection chicken product whose best-by date fell on Sunday, three days after the federal alert became active. The hard facts are narrow: one named SKU, one lot code, nine states, two Kroger banners and no confirmed adverse reactions in public reports.

Kroger Co. shares were up again midday Tuesday, building on gains from the last session. Investors are coming back to the grocer as it looks to cut prices and keep share from Walmart, Amazon, and club stores.