That’s a good headline, right? I pulled that quote from a Tony Daltorio ad that I saw over the weekend — and it seems to have the finger on the pulse of my nerves, at least, because combining those phrases “blue chip” and “windfall” in one sentence really give me a nice, warm feeling in my stomach.

Of course, if there’s really a 2,537% ‘windfall’ potential anytime soon, it probably ain’t a “blue chip” that makes you feel comfortable buying shares — that number was pulled from the incredible transformation Domino’s made when they went “all in” on digital and revamped their recipes at the same time, beginning almost ten years ago… but we can dream, right? So let’s look into the ad and see what stock it is that Daltorio is hinting at… then we can decide for ourselves.

The big picture part of the spiel for Growth Stock Advisor ($49/yr at the moment) is about something he calls the “Digital Helix” — and it’s what he says made it possible for Home Depot and Dominos and Best Buy to recover and thrive when Sears and Circuit City and so many others were floundering… here’s a little excerpt:

“… while the potential of this new technology is virtually limitless…

“Most retailers have absolutely NO CLUE how to put it to use…

“Staples has been closing stores left and right over the last years.

“Barnes & Noble is currently on its last leg.

“Sears was once one of the biggest department stores… and is now in its death throes.

“These are all retailers that poured hundreds of millions into digital transformation…

“And they all failed horribly at making their investments pay off or turning their businesses around.

“But I’ve discovered that all the WINNERS of this $100 trillion digital transformation have one thing in common…

“They Are All Using the Same Secret Weapon… The ‘Digital Helix'”

The “digital helix,” it seems, is all about doing a good job of combining traditional retail with new digital tools — he says it comes down to three “profit drivers:”

“Profit Driver #1: Focus on DIGITAL sales to boost revenues.

“Profit Driver #2: Give your customer experience a DIGITAL facelift.

“Profit Driver #3: Use cutting-edge supply chain technology to deliver products FASTER and CHEAPER”

OK, nothing terribly controversial there — though I imagine it’s probably pretty hard to tell from a quarterly press release whether a company is “transforming” or just throwing money at better websites and mobile apps.

So what company is it that he’s specifically teasing? A few more clues for you:

“This company has already finished a lot of the ‘heavy lifting’ — pouring billions into their digital transformation.

“Their stock hasn’t made any big moves yet.

“But once it gets going, it will move very, very fast.

“And this breakout could come soon!

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“My research indicates you want to be on board before December 6….”

OK, so they’ve probably been investing in digital stuff for quite a while, and there’s some kind of news coming before Thursday… what else?

“This ONE company I have identified it could make you more money than Home Depot, Best Buy and Domino’s Pizza combined.

“It is currently the FIRST and ONLY company using the Digital helix in a $5.75 TRILLION market.”

So… a much bigger market than consumer electronics or pizza, at least on a revenue basis. Other hints?

“… their competitors are completely missing the boat right now…

“They are getting SLAUGHTERED in the retail apocalypse.

“18 major companies in this market have gone under/closed their doors since 2014…”

And a few clues about what they’re specifically doing…

“In 2017, their digital sales soared 90%.

“And in 2018 they have already boosted their digital sales by another 66%.

“Right now, they’re busy working on the second profit driver of the Digital Helix… upgrading their customer experience.

“They’re rolling out an infrared-sensor monitoring system in their store locations that automatically sends staff to checkouts as necessary.

“This way you never have to endure long lines at the cash register.

“They are also testing a hi-tech shelf display technology that, according to Business Insider, could ‘change this industry as we know it’.”

So… hoodat? Thinkolator sez the “secret” stock being touted is: Kroger (KR), the grocery store giant whose narrative went from “growth darling that revolutionizes grocery shopping” four or five years ago to “has-been getting destroyed by Wal-Mart and about to be eaten by Amazon’s Whole Foods” last year.

And as with all narratives, probably the truth is somewhere between those extremes — Kroger is a pretty healthy (albeit high-debt) grocery store operator with some strong brands and loyal customers, in an industry that has had a LOT of bankruptcies, as grocery shopping has transformed over the past decade or so with the rise of supercenters and organic foods and the seemingly falling appeal of traditional American branded, processed and packaged foods. The story over the past few years has been that the organics and specialty grocers (Whole Foods, Trader Joe’s, etc.) are taking away the high-end urban and suburban shoppers, while Wal-Mart, with its increasing focus on groceries, has taken away the lower-income and rural shoppers.

Kroger definitely hit a slow patch, with relatively slow revenue growth over the past five years or so and a few years of dropping income, but 2018 has been quite good so far, even if you take away some of the impact of the tax cuts and whatever other one-time items bumped their earnings per share up dramatically in the past couple quarters (“normalized” earnings came in at about $2 a share in each of the past couple quarters, but basic EPS was over $4).

They still have lots of competition, but among the “traditional” grocery stores Kroger is the obvious king of the heap — it’s almost twice as big as number two player Albertson’s, so they will continue to have a lot of influence and cost efficiency and power over their suppliers… and they’ve also been much better than other traditional grocers in pushing “private label” brands over the years, which helps to keep prices down and margins up. That huge size also makes investments in digital initiatives more feasible, even when they take a while to bear fruit — so they’ve put a lot into analytics and in-store technology as well as digital ordering and delivery. They even bought a stake in UK robotic warehouse specialist Ocado as part of their plan to use Ocado’s technology in a bunch of new “smart warehouses.”

Kroger pays a decent dividend (yield just under 2%), and trades at a forward PE of about 13… so it’s a lot cheaper than Walmart or Costco, at least partly because it’s not a particularly sexy “story” stock, but it trades at a very similar valuation to Target (TGT), which has been growing revenues nicely but really struggling to grow earnings.

So yes, Kroger leads its industry and trades at a rational valuation. I don’t know if their investments in digital will just keep them treading water, or if they will be enough to provide some actual growth in the future, but it seems like a reasonable stock that has a decent chance of doing pretty well. I would be shocked if they end up seeing a big surge in revenue or earnings growth in short order, but it’s certainly possible that a better-than-expected surge in digital orders or early success with their Ocado warehouses and same-day-delivery ambitions could change the narrative for investors and get them excited again, getting KR a better PE ratio and driving the shares up.

And yes, there is a catalyst coming this week — Kroger reports earnings on December 6, so that is a real date. Whether it ends up being bad news or good news, I couldn’t tell you… I left my all-seeing eye in my other pants. Kroger pleased investors when they reported in June, bumping the stock price up about 10%, and the market had almost exactly the opposite reaction when they reported their most recent quarter in September. The stock is trading at a below average valuation, compared to Kroger’s history, but it has certainly been quite a bit cheaper during past slumps, too.

At current prices around $30 I’m inclined to agree with Morningstar, whose analysts says it’s trading right around fair value and might have a narrow “moat” thanks to their digital investments and market-leading size, which lets them market and operate more efficiently, especially in their biggest 50 or so population centers. I’d want to understand their digital initiatives and get a sense for their quality versus competitors before I’d think about buying the stock at this valuation, mostly because the relatively high debt burden is too much for me to think of it as “cheap” right now and there’s not a lot of room for any grocer to expand profit margins… but if they can get back to steady growth and make investors feel a little better about their prospects, I can certainly see how better days are possible. I’d guess that the stock will still be somewhere between $20 and $40 in a year, but I haven’t spent much time looking at it and that’s really just a guess. It has been a well-run company in the past, and is a clear survivor in an industry that has been decimated in many parts of the country, so it’s not crazy to think about investing in Kroger… just don’t go in looking for a 2,500% return.

That’s what I’m thinking, but it’s your money — so your thoughts are what matters… think Kroger is likely to be the next retail winner thanks to their digital initiatives? Think it’s too crazy? Not crazy enough? Let us know with a comment below.

P.S. Tony Daltorio’s Growth Stock Advisor has now been around for a year or so, which means subscribers are probably starting to form an opinion… if you’ve subscribed to Growth Stock Advisor, please click here to share your experience with your fellow investors. Thank you!

Disclosure: I own shares of Amazon among the stocks mentioned above. I will not trade in any covered stock for at least three days after publication, per Stock Gumshoe’s trading rules.