(Reuters) – Kroger (NYSE:) beat Wall Street forecasts for quarterly same-store sales on Thursday, taking advantage of more shoppers flocking to its outlets for cheaper groceries as persistent inflation pushes budgets tighter households.
Shares of the company, whose $24.6 billion deal with smaller rival Albertsons (NYSE:) is under antitrust scrutiny, rose about 4% in premarket trading.
As food prices begin to fall faster than restaurant menu prices, American consumers on a budget are preparing more meals at home rather than going out to eat, helping boost sales at grocery stores.
Data from the U.S. Bureau of Labor Statistics showed that unadjusted prices for eating out were up 1% in May from a year earlier, while prices for eating out were up 4% from May 2023.
Like-for-like sales excluding fuel rose 0.5% at the supermarket chain in the first quarter, compared with analysts’ average estimate of 0.13% growth, according to LSEG.
The company also confirmed full-year same-store sales and adjusted its profit forecast.