Albertsons Posts 22.3% EPS Miss, Ends Three Straight Beats
Albertsons posted EPS of $0.42 against a $0.538 consensus, missing by 22.3% and ending three consecutive beats, while shareholders approved governance changes on August 6. With $15.70 billion in debt
Albertsons Passes Governance Vote as Debt Overhang Looms
NEW YORK, August 15 —
Albertsons Companies, Inc. (ACI) shareholders approved governance changes on August 6, but the approval arrives amid deteriorating conditions: a 22.3% EPS miss just snapped three straight beats, legal probes have entered the analyst conversation, and $15.70 billion in debt sits against $0.31 billion in cash.
- Free cash flow of $1.75 billion over the trailing twelve months; shares trade at 6.6x forward earnings at $12.42.
- Short sellers hold 14.8% of float; the consensus analyst target implies 14% upside from current levels.
The Miss That Ended Three Straight Beats
Analysts responded with an EPS cut, per published commentary, and Royal Bank of Canada trimmed its position by 235,336 shares. Albertsons reported $83.23 billion in trailing revenue across 16 banners, including Safeway, Jewel-Osco, Vons, and Shaw's, plus in-store pharmacies and fuel centers, at 0.2% annual growth. That scale generates $1.75 billion in trailing free cash flow, but debt service consumes most of it.
What the Free Cash Flow Doesn't Fix
$15.70 billion in total debt against $0.31 billion in cash is the number that reframes the 6.6x forward P/E. At 27.0% gross margin on $83.23 billion in revenue, Albertsons generates $2.34 billion in trailing operating cash flow, but with leverage at this scale, almost nothing reaches the balance sheet. A DCF model applied to that cash flow has to discount heavily for both the debt load and the legal uncertainty. Analysts cite the legal probes as factors that "could reshape" the investment narrative, per published reports. Short sellers hold 14.8% of float.
| Ticker | Mkt cap | Fwd P/E | 52-wk |
|---|---|---|---|
| ACI | $6.1B | 6.6x | -35.5% |
| BTU | $3.1B | 9.0x | +40.9% |
| CNX | $5.3B | 9.2x | +25.9% |
| ABG | $3.8B | 7.0x | -12.4% |
| AFG | $12.1B | 12.1x | +11.7% |
| AJG | $64.4B | 16.9x | -13.9% |
The Recovery the Valuation Requires
At $12.42, the forward multiple embeds a recovery not yet visible in results: trailing twelve-month EPS of $0.16 implies forward earnings roughly an order of magnitude higher. The next quarterly report is the first test of whether that recovery is real or whether the recent miss reflects something structural. Legal probes add a variable without a timeline. The governance changes approved August 6 don't resolve the underlying financial position: leverage that dwarfs available cash leaves little cushion if operations stumble again. Run the free Albertsons Companies, Inc. deep-dive →
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Frequently Asked Questions
What did Albertsons report for its latest earnings?
Albertsons posted EPS of $0.42 against a consensus of $0.538, missing by 22.3%. The result ended three consecutive beats of 10.1%, 5.9%, and 9.1%. Analysts responded with an EPS cut, and Royal Bank of Canada trimmed its position by 235,336 shares.
How much debt does Albertsons carry?
Albertsons carries $15.70 billion in total debt against $0.31 billion in cash. The company generates $2.34 billion in trailing operating cash flow and $1.75 billion in trailing free cash flow, but at that level of leverage, little reaches the balance sheet.
What is Albertsons' current stock price and valuation?
Shares trade at $12.42, implying 6.6x forward earnings. The consensus analyst target implies 14% upside from current levels, while short sellers hold 14.8% of float.
What legal issues are affecting Albertsons?
Analysts cite active legal probes as factors that "could reshape" the investment narrative, per published reports. The article notes these probes add a variable without a timeline to the investment case.
What governance changes did Albertsons shareholders approve?
Shareholders approved governance changes on August 6. The article notes those changes do not resolve the underlying financial position, as leverage that dwarfs available cash leaves little cushion if operations stumble again.
Albertsons shareholders approved governance changes at the company's August 6 annual meeting — but the vote arrives as the grocery chain faces a 22.3% EPS miss that snapped three consecutive beats, legal probes that analysts say could reshape the investment narrative, and $15.70 billion in debt against just $0.31 billion in cash.