Grocery Outlet Holding Corp (GO)
NASDAQ:GO
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Grocery Outlet Holding
(NASDAQ:GO)
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Rating:46Neutral
Price Target:
$7.00
▲(0.14% Upside)
Action:ReiteratedDate:04/03/26
The score is held down primarily by the sharp deterioration in profitability and continued leverage risk, despite improved operating cash flow. Technicals remain weak with the stock below key longer-term moving averages and negative MACD. Valuation is not supportive due to losses (negative P/E), while the latest earnings call provides a balanced offset: near-term comp and margin headwinds, but credible operational actions and portfolio rationalization aimed at improving long-run EBITDA.
Positive Factors
Stable gross margins & steady revenue growth
Consistent top-line expansion plus a durable ~30% gross margin reflect Grocery Outlet’s value-driven, opportunistic sourcing model. Stable gross spread supports long-run unit economics and resilience to price volatility, enabling sustained gross profit even as SG&A is managed across the franchise-like operator network.
Negative Factors
Elevated leverage and limited balance-sheet flexibility
High leverage for a low-margin grocer constrains strategic flexibility: refinancing, growth capex and funding of restructuring become more expensive and risk covenants. In a sector with thin margins, sustained leverage reduces the buffer for cyclical sales dips and increases exposure to interest cost volatility.
Read all positive and negative factors
Positive Factors
Negative Factors
Stable gross margins & steady revenue growth
Consistent top-line expansion plus a durable ~30% gross margin reflect Grocery Outlet’s value-driven, opportunistic sourcing model. Stable gross spread supports long-run unit economics and resilience to price volatility, enabling sustained gross profit even as SG&A is managed across the franchise-like operator network.
Read all positive factors
Grocery Outlet Holding (GO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$686.09M
Dividend YieldN/A
Average Volume (3M)4.91M
Price to Earnings (P/E)―
Beta (1Y)0.76
Revenue Growth7.22%
EPS Growth-108.99%
CountryUS
Employees1,692
SectorConsumer Defensive
Sector Strength42
IndustryGrocery Stores
Share Statistics
EPS (TTM)0.19
Shares Outstanding98,153,080
10 Day Avg. Volume3,628,443
30 Day Avg. Volume4,908,298
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)1.01
Price to Sales (P/S)0.21
P/FCF Ratio41.87
Enterprise Value/Market Cap3.55
Enterprise Value/Revenue0.52
Enterprise Value/Gross Profit1.72
Enterprise Value/Ebitda-28.56
Forecast
1Y Price Target
$8.50Price Target Upside21.60% Upside
Rating ConsensusHold
Number of Analyst Covering13
EPS Forecast (FY)0.52
Revenue Forecast (FY)$4.68B
Grocery Outlet Holding Business Overview & Revenue Model
Company Description
Grocery Outlet Holding Corp. owns and operates a network of independently operated stores in the United States. The company's stores offer products in various categories, such as dairy and deli, produce, floral, and fresh meat and seafood products...
How the Company Makes Money
Grocery Outlet makes money primarily by generating retail sales through its network of independently operated Grocery Outlet stores and related supply and distribution activities. The core revenue model is driven by (1) merchandise sales: the comp...
Grocery Outlet Holding Key Performance Indicators (KPIs)
Any
Comparable Store Sales Growth
Measures year‑over‑year sales at stores open long enough to be comparable, isolating organic demand from new-store openings. Rising comps signal stronger customer traffic or larger baskets; falling comps point to weakening demand, competitive pressure, or inventory issues—important for gauging whether Grocery Outlet’s value proposition is gaining or losing traction.
Measures year‑over‑year sales at stores open long enough to be comparable, isolating organic demand from new-store openings. Rising comps signal stronger customer traffic or larger baskets; falling comps point to weakening demand, competitive pressure, or inventory issues—important for gauging whether Grocery Outlet’s value proposition is gaining or losing traction.
Data provided by:
The Fly
The FlyGrocery Outlet Holding Earnings Call Summary
Earnings Call Date:Mar 04, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 12, 2026
Earnings Call Sentiment Neutral
The call presented a mixed picture: material near-term challenges and one‑time impairments drove a sizeable GAAP net loss and prompted a disciplined portfolio reset (36 store closures) and promotional investment that will weigh on near‑term results. At the same time, management outlined concrete operational fixes (merchandising, DC capacity, forecasting, unified buying), reported stronger cash generation, improving opportunistic mix (circa +200 bps mix, +150 bps shipments) and early comp improvement after promotions. Management framed losses and closures as corrective steps and provided tighter underwriting and IRR targets for new stores, but comps and UPT remain under pressure and several costs will suppress short‑term profitability. Overall, the positives and negatives are roughly balanced: tangible operational progress and credible plans exist, but significant headwinds and large noncash charges mean recovery will take time.Positive Updates
Top-Line Growth (Including 53rd Week)
Fourth quarter net sales increased 10.7% to $1.22 billion, including $82.4 million from a 53rd week; excluding the extra week, net revenue rose 3.2% year-over-year.
Negative Updates
Comparable Store Sales Weakness
Q4 comparable store sales declined 80 basis points (excluding the extra week), with basket pressure driving a 170 basis point decline in average transaction size partially offset by a 90 basis point increase in traffic; comps continued to decelerate into January.
Read all updates
Q4-2025 Updates
Positive
Negative
Top-Line Growth (Including 53rd Week)
Fourth quarter net sales increased 10.7% to $1.22 billion, including $82.4 million from a 53rd week; excluding the extra week, net revenue rose 3.2% year-over-year.
Read all positive updates
Company Guidance
The company guided to a full‑year comparable store sales decline of -2% to flat (Q1 comp -2.5% to -1.5%), total net sales of $4.6B–$4.72B (noting the 2025 extra 53rd week contributed $82.4M of sales and $9M of adjusted EBITDA that will not recur), and plans to add 30–33 net new stores while closing 36 underperforming locations (expected to depress near‑term revenue by ~2% but produce ~ $12M of annualized adjusted EBITDA improvement). Full‑year gross margin is forecast at 29.7%–30.0% (Q1 29.6%–29.8%, or 30.0%–30.2% excluding inventory‑liquidation impacts), adjusted EBITDA $220M–$235M (Q1 $39M–$43M), depreciation & amortization ~ $136M, net interest ~ $27M, CapEx (net of tenant allowances) ~ $170M, expected cash costs to execute closures $51M–$63M (management cited ~ $57M of cash charges, ~$12M bad debt and ~$52M of noncash lease write‑offs), share‑based comp ~ $18M, a normalized tax rate of ~28%, ~99M average diluted shares, and full‑year adjusted EPS of $0.45–$0.55 (Q1 adjusted EPS ~$0.01–$0.04).Grocery Outlet Holding Financial Statement Overview
Summary
Income Statement
42
Neutral
Balance Sheet
46
Neutral
Cash Flow
52
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 4.69B | 4.37B | 3.97B | 3.58B | 3.08B |
| Gross Profit | 1.42B | 1.32B | 1.24B | 1.09B | 948.79M |
| EBITDA | -85.34M | 192.35M | 214.97M | 173.09M | 165.44M |
| Net Income | -224.91M | 39.47M | 79.44M | 65.05M | 62.31M |
Balance Sheet | |||||
| Total Assets | 3.09B | 3.17B | 2.97B | 2.77B | 2.67B |
| Cash, Cash Equivalents and Short-Term Investments | 69.60M | 62.83M | 114.99M | 102.73M | 140.09M |
| Total Debt | 1.81B | 1.66B | 1.39B | 1.41B | 1.46B |
| Total Liabilities | 2.11B | 1.98B | 1.75B | 1.66B | 1.66B |
| Stockholders Equity | 983.66M | 1.20B | 1.22B | 1.11B | 1.01B |
Cash Flow | |||||
| Free Cash Flow | 23.80M | -74.65M | 111.46M | 55.03M | 42.20M |
| Operating Cash Flow | 222.13M | 111.96M | 303.45M | 185.51M | 165.59M |
| Investing Cash Flow | -229.68M | -274.03M | -194.16M | -149.93M | -136.71M |
| Financing Cash Flow | 14.32M | 109.91M | -97.02M | -72.94M | 5.88M |
Grocery Outlet Holding Technical Analysis
Negative
6.99
Price Trends
8.27
Negative
9.34
Negative
12.39
Negative
Market Momentum
-0.30
Negative
46.43
Neutral
82.78
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GO, the sentiment is Negative. The current price of 6.99 is above the 20-day moving average (MA) of 6.51, below the 50-day MA of 8.27, and below the 200-day MA of 12.39, indicating a neutral trend. The MACD of -0.30 indicates Negative momentum. The RSI at 46.43 is Neutral, neither overbought nor oversold. The STOCH value of 82.78 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GO.
Grocery Outlet Holding Risk Analysis
Grocery Outlet Holding disclosed 47 risk factors in its most recent earnings report. Grocery Outlet Holding reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Grocery Outlet Holding Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $572.80M | 7.26 | 11.37% | 2.63% | 3.88% | 7.71% | |
66 Neutral | $611.99M | 12.71 | 23.11% | 1.99% | 7.19% | 35.90% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
61 Neutral | $9.28B | 8.31 | 28.54% | 3.49% | 2.08% | -1.63% | |
60 Neutral | $1.72B | 11.86 | 5.93% | 0.93% | -5.42% | -20.80% | |
58 Neutral | $1.77B | 17.84 | 6.83% | 2.06% | 3.11% | 6.54% | |
46 Neutral | $686.09M | -4.43 | -19.78% | ― | 7.22% | -108.99% |
* Consumer Defensive Sector Average
GO
Grocery Outlet Holding
6.99
-6.87
-49.57%
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Grocery Outlet Holding Corporate Events
Business Operations and StrategyExecutive/Board Changes
Grocery Outlet Holding Expands Board With New Independent Directors
Positive
Apr 2, 2026
On April 1, 2026, Grocery Outlet Holding Corp. expanded its Board of Directors from ten to twelve members and appointed Frances L. Allen and Felicia D. Thornton as independent directors, with their terms effectively running until the company’...
Business Operations and StrategyFinancial Disclosures
Grocery Outlet Launches Store Optimization and Closure Plan
Negative
Mar 4, 2026
On March 2, 2026, Grocery Outlet’s board approved a business optimization plan after a first-quarter fiscal 2026 review, calling for the closure of 36 financially underperforming stores, exit of related leases including one unused distributi...
Business Operations and StrategyExecutive/Board Changes
Grocery Outlet Announces Leadership Transition in Merchandising Operations
Positive
Jan 13, 2026
On January 13, 2026, Grocery Outlet Holding Corp. announced that longtime Executive Vice President and Chief Purchasing Officer Steve Wilson will retire effective March 20, 2026, after 31 years with the company, and will receive separation benefit...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.