Grocery Outlet Holding (GO) AI Stock Analysis

• Market Cap: $981.37M
• Dividend Yield: N/A
• Average Volume (3M): 2.51M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.73
• Revenue Growth: 7.22%
• EPS Growth: -108.99%
• Country: US
• Employees: 1,692
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Grocery Stores
• EPS (TTM): 0.21
• Shares Outstanding: 98,137,230
• 10 Day Avg. Volume: 2,918,536
• 30 Day Avg. Volume: 2,511,222
• PEG Ratio: -0.77
• Price to Book (P/B): 1.28
• Price to Sales (P/S): 0.35
• P/FCF Ratio: -20.46
• Enterprise Value/Market Cap: 3.39
• Enterprise Value/Revenue: 0.73
• Enterprise Value/Gross Profit: 2.40
• Enterprise Value/Ebitda: 21.98
• 1Y Price Target: $15.00
• Price Target Upside: 50.00% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9
• EPS Forecast (FY): 0.79
• Revenue Forecast (FY): $4.70B

• Rating: 52 Neutral
• Price Target: $11.50 ▲(15.00% Upside)

Grocery Outlet Holding faces significant challenges with profitability and cash flow, compounded by recent negative impacts from external events like the government shutdown. While there are strategic initiatives in place to drive growth, the current financial and market conditions present substantial risks. The technical indicators suggest bearish momentum, and valuation metrics are unattractive due to the company's unprofitability.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective expansion strategies, supporting long-term business sustainability.

Store Refresh Program

The successful store refresh program suggests potential for increased sales and customer engagement, enhancing competitive positioning.

Leadership Additions

New leadership in operations and supply chain can drive efficiency improvements and strategic growth, strengthening management quality.

Negative Factors

Profitability Challenges

Ongoing profitability issues may hinder reinvestment and growth, posing risks to financial stability and long-term viability.

Cash Flow Issues

Declining free cash flow suggests liquidity constraints, limiting the company's ability to fund operations and strategic initiatives.

Impact of Government Shutdown

The reliance on government assistance programs exposes the company to external risks, affecting sales stability and financial forecasts.

Grocery Outlet Holding Business Overview & Revenue Model

Company Description

Grocery Outlet Holding Corp. is an American discount grocery retailer that operates a chain of stores across the United States. It primarily focuses on offering a wide variety of grocery products, including fresh produce, dairy, meat, and pantry staples, at significantly reduced prices. The company operates through a unique business model that includes both traditional retail and a focus on providing consumers with high-quality products that are often surplus or overstock items from major manufacturers, helping to minimize waste while maximizing value for customers.

How the Company Makes Money

Grocery Outlet generates revenue primarily through the sale of grocery items at discounted prices. Its revenue model is based on purchasing surplus and discontinued products from manufacturers and wholesalers at lower costs and then passing on those savings to consumers. Key revenue streams include sales of perishable goods such as fruits, vegetables, meats, and dairy products, as well as non-perishable items like canned goods, snacks, and household products. The company also benefits from strong partnerships with suppliers who provide products at reduced prices, allowing Grocery Outlet to maintain a wide variety of inventory while keeping operational costs low. Additionally, the company's franchise model allows for further income generation through franchise fees and royalties from its franchisee partners.

Grocery Outlet Holding Financial Statement Overview

Summary

Grocery Outlet Holding shows stable revenue growth and gross profit margins, but faces challenges with profitability and cash flow management. The high leverage and declining return on equity highlight potential financial risks. Overall, the company needs to focus on improving operational efficiency and cash flow generation to enhance financial stability.

Income Statement

Grocery Outlet Holding shows a modest revenue growth rate of 1.15% in the TTM, with a stable gross profit margin of 30.5%. However, the net profit margin is quite low at 0.38%, indicating challenges in converting revenue into profit. The EBIT and EBITDA margins have declined compared to previous years, suggesting increased operational costs or inefficiencies.

Balance Sheet

The company has a high debt-to-equity ratio of 1.48, indicating significant leverage, which could pose risks if not managed well. The return on equity has decreased to 1.42%, reflecting lower profitability on shareholders' investments. The equity ratio is stable, suggesting a balanced asset structure.

Cash Flow

Free cash flow has decreased significantly, with a negative growth rate of -30.19% in the TTM, and the free cash flow to net income ratio is negative, indicating cash flow challenges. The operating cash flow to net income ratio is 0.42, showing some ability to generate cash from operations, but it has declined from previous periods.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.57B	4.37B	3.97B	3.58B	3.08B	3.13B
Gross Profit	1.38B	1.32B	1.24B	1.09B	948.79M	973.35M
EBITDA	151.20M	192.35M	214.97M	173.09M	165.44M	166.96M
Net Income	-4.44M	39.47M	79.44M	65.05M	62.31M	106.71M
Balance Sheet
Total Assets	3.37B	3.17B	2.97B	2.77B	2.67B	2.49B
Cash, Cash Equivalents and Short-Term Investments	52.13M	62.83M	114.99M	102.73M	140.09M	105.33M
Total Debt	1.81B	1.66B	1.39B	1.41B	1.46B	1.38B
Total Liabilities	2.17B	1.98B	1.75B	1.66B	1.66B	1.56B
Stockholders Equity	1.20B	1.20B	1.22B	1.11B	1.01B	922.31M
Cash Flow
Free Cash Flow	-42.06M	-74.65M	111.46M	55.03M	42.20M	50.46M
Operating Cash Flow	203.79M	111.96M	303.45M	185.51M	165.59M	181.24M
Investing Cash Flow	-250.92M	-274.03M	-194.16M	-149.93M	-136.71M	-133.79M
Financing Cash Flow	30.61M	109.91M	-97.02M	-72.94M	5.88M	29.77M

Grocery Outlet Holding Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 10.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

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 10 is below the 20-day moving average (MA) of 10.84, below the 50-day MA of 12.43, and below the 200-day MA of 14.28, indicating a bearish trend. The MACD of -0.58 indicates Positive momentum. The RSI at 29.77 is Positive, neither overbought nor oversold. The STOCH value of 8.15 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GO.

Grocery Outlet Holding Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IMKTA	72 Outperform	$1.33B	16.29	5.29%	0.92%	-5.42%	-20.80%
VLGEA	71 Outperform	$504.60M	9.89	11.22%	2.63%	3.88%	7.71%
NGVC	70 Neutral	$579.97M	12.61	24.02%	2.03%	7.19%	35.90%
WMK	67 Neutral	$1.66B	17.71	7.22%	2.02%	3.11%	6.54%
ACI	64 Neutral	$9.57B	10.31	32.04%	3.44%	2.08%	-1.63%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
GO	52 Neutral	$981.37M	-210.08	-0.37%	―	7.22%	-108.99%

Grocery Outlet Holding Corporate Events

Grocery Outlet Reports Sales Decline Amid Government Shutdown

As of December 3, 2025, Grocery Outlet Holding Corp. reported a decline in comparable store sales for November 2025 due to a U.S. government shutdown affecting federally-funded assistance programs. This led to an 8.2% drop in sales from Electronic Benefits Transfer payments and a 0.5% decline in non-EBT transactions. Consequently, the company adjusted its outlook for the fourth quarter and fiscal year 2025, expecting flat comparable store sales and diluted adjusted earnings per share at the low end of its previous forecast. The company uses non-GAAP financial measures to assess performance, but these metrics have limitations and should not be viewed in isolation.