Albertsons (ACI) delivered a mixed performance in the first quarter of Fiscal 2024 results. The company exceeded analyst expectations on revenue, but its bottom line came in below the consensus estimate. Following the release of fiscal Q1 results, ACI stock gained 1.4% in yesterday’s regular trading session.
ACI is an American grocery company. It should be noted that the company has an impressive earnings surprise history, as it has missed estimates in only one quarter since October 2020 (for a thorough assessment of ACI stock, go to TipRanks’ Stock Analysis page).
ACI: Q1 Snapshot
The company reported Q1 adjusted earnings of $0.66 per share, which marginally missed the Street’s expectations of $0.67 and decreased 29% year-over-year. This decrease can be attributed to higher wages and rising delivery costs.
Meanwhile, net sales and other revenue climbed by 1% to $24.3 billion and came in higher than the consensus estimates of $24.2 billion. The top line benefited from 23% year-over-year growth in online sales. Furthermore, the company’s loyalty program witnessed a 15% membership growth to 41.4 million.
Challenges Ahead
CEO Vivek Sankaran anticipates that Albertsons will continue to face headwinds from higher investments and a shift towards lower-margin pharmacy and digital businesses.
However, the company expects these challenges to be partially mitigated by ongoing productivity initiatives, such as store upgrades, new store openings, and further investments in digital platforms.
Is ACI a Good Buy?
Currently, ACI has a Moderate Buy consensus rating based on one Buy and two Hold recommendations. After a year-to-date decline of over 11%, the analysts’ average price target on Albertsons stock of $24.42 per share implies 20.83% upside potential. However, analysts’ views on ACI could see changes following today’s earnings report.
