BUZZ-Kroger rises after Jefferies upgrades stock to 'buy'

** Food retailer Kroger's KR.N shares rise ~1% to $60.72 premarket

** Brokerage Jefferies upgrades stock to "buy" from "hold"; co set to report Q3 results on Dec. 5

** Says KR foot traffic trends have been improving in October, while fuel business, an "incremental kicker," is structurally more profitable now than pre-pandemic; raises PT to $73 from $54

** Says even if the $25 bln merger with rival grocer Albertsons ACI.N doesn't happen, KR will keep ~$6 bln of ~$10.5 bln in debt it raised and likely use it for share buybacks, driving EPS

** Brokerage also sees EPS upside if the deal works out, says ACI's operating inefficiency gives KR opportunity to realize more synergies to better compete with Walmart WMT.N, Costco COST.O, and Amazon AMZN.O

** In August, U.S. Federal Trade Commission argued to block the merger citing a possible surge in grocery prices

** Eleven of 23 brokerages rate the stock "buy" or higher, and 12 "hold"; with a median PT of $59 - LSEG

** Up to Monday's close, stock has risen ~32% YTD

(Reporting by Neil J Kanatt in Bengaluru)

((Neil.JKanatt@thomsonreuters.com;))