Albertsons Companies

Structural competition keeps pricing power weak. For fiscal 2025, gross margin was 27.2% while selling and administrative expenses were 26.3%, leaving razor‑thin operating room and a TTM net margin near 0.3% on 83.2 billion dollars of net sales.

Pharmacy mix and IRA-related dynamics further pressured gross profit, and management’s fiscal 2026 outlook embeds a roughly 150 bps identical‑sales headwind from IRA’s Medicare negotiation program.

The Washington AG’s 2026 lawsuit over BOGO promotions raises the risk that promotional levers become more constrained, reducing flexibility to engineer price perception. We see limited latent pricing power outside of selective private‑label, fresh and targeted personalized offers.