Although much of yesterday's stock appreciation was a result of the Federal Reserve's rate-cut decision, Kroger (NYSE:KR) fed investors some pretty tasty results that surely had a hand in driving the stock up 7.5%.

For the quarter, earnings jumped 31%, to $0.38 per share. Same-store sales climbed 5.8%, and stripping out the strong fuel sales the company incurred, comps growth still remained at a decent 5.1%. This was the ninth straight quarter of better than 3% comps growth for Kroger -- and that doesn't count fuel sales.

Working hard to maintain a debt-to-EBITDA level that will allow its debt to remain at investment grade, Kroger reduced its net total-debt-to-EBITDA ratio to 1.77 this quarter, compared to 1.87 in last year's quarter. The company still carries a hefty debt-to-equity ratio of 134%, but it also doesn't appear to have a problem servicing the debt, since earnings before interest and taxes covered interest expense 5.1 times.

As a result, Kroger has been able to focus on fun things for shareholders -- such as buying back shares and increasing the common dividend. During the second quarter alone, the company spent $578.1 million to repurchase 21.2 million shares. Look for more buybacks to come, too, since the company still has more than $600 million remaining on its $1 billion authorization. And the company raised its quarterly dividend by 15% back in March.

But what I really think got investors lining up in the aisles for this quarterly report was the increase in guidance. Management believes that its performance so far this year has exceeded its expectations, so earnings are now expected to be $1.64-$1.67 a share, up from the previously expected $1.60-$1.65. The company had previously mentioned that certain 2006 items would affect earnings-per-share growth in 2007, and it maintains its strong third-quarter growth expectations -- and its weaker fourth-quarter earnings growth outlook -- based on these items.

Everyone thought Wal-Mart's (NYSE:WMT) entry into the food business would spell doom for grocers, and Whole Foods (NASDAQ:WFMI) seemed to have captured the organic market. However, Kroger has managed just fine. Despite its foray into financial services, its bread-and-butter food business has been feeding shareholders well. It has also held on to its historical margins fairly well, considering the inflationary pressures the company is facing.

I continue to be impressed with the company's performance. It has managed to continue posting solid results, despite a very competitive landscape. In these turbulent times, you may want to play a little defense and pick up shares of this grocer.

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Fool contributor Larry Rothman is happy to receive feedback, and he promises to read it when he's not being wrestled by his three children. Feel free to email him at rothmanviews@comcast.net. He doesn't have any positions in the companies mentioned. The Fool has a disclosure policy.