As she ticked off Albertsons’ latest accomplishments at the start of the grocer’s third-quarter earnings call last week, CEO Susan Morris made the case that its stock price should be higher.
During the quarter, she said, Albertsons made “bold decisions” in investing in artificial intelligence and other technologies and “purposeful investments” to attract shoppers while boosting its sales. This includes an AI-powered planning and shopping assistant and a private label assortment that’s approaching 30% penetration.
“We’re building a structurally advantaged Albertsons, one that wins in any environment, and yet our current valuation does not reflect the progress that we’ve made or the long-term earnings power we’re creating,” Morris said. “This disconnect only sharpens our resolve to execute faster, scale our transformation and deliver the performance that ultimately commands the value this company deserves.”
Morris’ comments during the Jan. 7 call echo her point during the company’s second-quarter call last October, when she also said that its shares are undervalued.
“Our share price is very much underappreciated and does not fully reflect the strength of our foundation or the opportunities within our strategy to drive long-term shareholder value,” she said during that call.
But while Albertsons has sought to convince investors that its stock price is a bargain relative to the company’s performance, investors have so far not taken heed.
Albertsons quarterly sales have steadily lost momentum in recent quarters, growing at a rate of just below 2% in the third quarter of fiscal 2025 after moving up by at least 2% during each of the prior three quarters. The company’s comparable-store sales growth has also lost steam.
At the end of the trading day on Wednesday, Albertsons’ shares closed at $17.71, down more than 7% compared with their closing price on Oct. 14, 2025, when Morris made her point that the company should have a richer valuation. Moreover, the company’s stock price is off by almost 20% since Morris assumed her position as CEO on May 1, 2025.
What’s behind the lack of enthusiasm from investors? It’s difficult to say exactly, though the failed merger with Kroger has clouded Albertsons’ future outlook. The grocer is also facing stiff competition from discount players and specialty grocers at a time when price sensitivity among consumers remains high.
In another sign that Albertsons’ message isn’t resonating with investors, the company’s current stock market valuation is almost exactly where it was in October 2022, when Albertsons announced its ill-fated effort to combine with Kroger. Moreover, the grocer’s stock price is about where it was when the merger plan fell through at the end of 2024.
Albertsons stock market valuation has moved down over the past year
Albertsons’ stock price has climbed over the past week. The company’s closing share price on Wednesday represented a gain of about 10% since Albertsons announced its third-quarter earnings, although its stock was down again on Thursday morning.
Albertsons executives remain undeterred in their resolve to demonstrate the company’s value, and have promised to lay out how it has become more productive when it presents its fourth-quarter financial results later this year.
“We are achieving our productivity and to some extent, exceeding our productivity,” Albertsons President and CFO Sharon McCollam said during the company’s call last week. “You can see that in the numbers that we’re delivering. And we expect to continue to be pushing that heavily as we go into 2026.”
