Grocers Supervalu and Safeway Among Top 5 Stocks of the SP500

Published on Wednesday, 20 January 2010 22:08 Written by Gerard Lerod

New York, January 20th (TradersHuddle.com) – Shares of grocery chain stores showed strength during a weak day, as a key player returned to profit.

Supervalu, Inc. (NYSE:SVU) was the third best stock in the S&P 500 index, as shares of the owner of Albertson’s climbed 5.47% to $15.62. Supervalu returned to a profit in its third quarter as it controlled costs and began its restructuring and turnaround plan.

The Minnesota grocer cut its selling and administrative expenses to $1.75 billion from $1.92 billion in the third quarter. And its net interest expense declined to $131 million from $143 million as interest rates fell and the company cut debt.

The company continued to see sales fall, with revenue dropping 9% to $9.22 billion for the quarter, missing analyst expectations.

Despite soft sales, the company earned $109 million, or 51 cents per share for the quarter. That's up from a loss of $2.94 billion, or $13.95 per share, in the third quarter last year, which included hefty goodwill and asset impairment charges of $14.57 per share.

Safeway, Inc. (NYSE:SWY)posted the fifth best percentage gain in the broad market index, as shares of the California based grocer jumped 5.44% to $23.07. Shares of Safeway moved higher as competitor Supervalu returned to profit, investors placed a bid as they speculate that the sector will continue to appreciate.