SUPERVALU INC. $14 (New York symbol SVU, Conservative Growth Portfolio, Consumer sector; Shares outstanding: 230 million; Market cap: $3.2 billion; Price-to-sales ratio: 0.1; WSSF Rating: Average) is the second-largest supermarket operator in the U.S. behind Kroger. Its 2,500 stores account for roughly 78% of its revenue. The remaining 22% comes from its food wholesale operations, which supply its own stores as well as more than 2,500 other grocery retailers. In its first fiscal quarter, which ended June 20, 2009, Supervalu earned $113 million, or $0.53 a share. That’s down 30.3% from $162 million, or $0.76 a share, a year earlier. Sales fell 4.7%, to $12.7 billion from $13.3 billion. Supervalu has been forced to lower its selling prices because of intense competition with large discount retailers like Wal-Mart. This has hurt its sales and profit margins. Separately, Supervalu will sell 36 of its stores in Utah. The company will realize a $150-million gain from the deal when it closes later this year. The company will probably earn $2.10 a share this year, and the stock trades at 6.7 times that estimate. The $0.70 dividend yields 5.0%. Supervalu is a hold.
SUPERVALU INC. $14 - New York symbol SVU
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