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Grocery Outlet Holding
(NASDAQ:GO)
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Rating:53Neutral
Price Target:
$13.50
▲(10.57% Upside)
Action:Reiterated
Date:08/17/26
The score is held back primarily by weakened financial performance—recent losses, deteriorated operating profitability, and higher leverage—despite positive operating cash flow. Technicals are supportive (price above key moving averages and positive MACD) but appear overextended (high RSI/Stoch). The earnings call adds modest support via raised guidance and operational/margin progress, while valuation remains constrained by negative earnings and no dividend yield provided.
Positive Factors
Revenue Growth and Gross Margin
Strong recent sales growth alongside a roughly 30% gross margin indicates the model is expanding without broad gross-margin erosion. If maintained, this combination can support reinvestment, improve operating leverage, and strengthen earnings recovery as execution initiatives mature.
Negative Factors
Profitability Deterioration
Revenue growth has not translated into durable earnings, as net losses and negative operating profitability now outweigh the benefit of higher sales. Continued losses can constrain reinvestment, weaken returns, and make the turnaround dependent on successfully restoring store-level and corporate margins.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue Growth and Gross Margin
Strong recent sales growth alongside a roughly 30% gross margin indicates the model is expanding without broad gross-margin erosion. If maintained, this combination can support reinvestment, improve operating leverage, and strengthen earnings recovery as execution initiatives mature.
Read all positive factors
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.
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The Fly
The FlyGrocery Outlet Holding (GO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.32B
Dividend YieldN/A
Average Volume (3M)2.08M
Price to Earnings (P/E)―
Beta (1Y)0.94
Revenue Growth5.12%
EPS Growth-4889.01%
CountryUS
Employees1,925
SectorConsumer Defensive
Sector Strength42
IndustryGrocery Stores
Share Statistics
EPS (TTM)-3.87
Shares Outstanding99,084,496
10 Day Avg. Volume1,911,587
30 Day Avg. Volume2,084,351
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 Cap2.13
Enterprise Value/Revenue0.59
Enterprise Value/Gross Profit1.98
Enterprise Value/Ebitda-11.86
Forecast
1Y Price Target
$10.83Price Target Upside-11.27% Downside
Rating ConsensusHold
Number of Analyst Covering10
EPS Forecast (FY)0.56
Revenue Forecast (FY)$4.70B
Grocery Outlet Holding Business Overview & Revenue Model
Company Description
Grocery Outlet Holding Corp. operates a network of retail stores across the United States, offering name-brand consumables and fresh products through independently operated locations. The company was founded by Jim Read in 1946 and is headquartere...
How the Company Makes Money
Grocery Outlet primarily makes money by selling grocery and household products through its Grocery Outlet stores, supported by a model that combines centralized purchasing with locally operated retail execution. Key elements of how it earns revenu...
Grocery Outlet Holding Earnings Call Summary
Earnings Call Date:Aug 12, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 10, 2026
Earnings Call Sentiment Positive
The call conveyed measurable operational progress and financial beats versus outlook: revenue growth (+1%), traffic gains (+1.8%), gross margin above outlook (30.2%), improved opportunistic assortment (op mix +300+ bps; op comps +500 bps vs start of Q1), and improved NPS and IO engagement. At the same time, comparable-store sales remain slightly negative (‑0.3%), basket is down (‑2.1% YoY), adjusted EBITDA and adjusted EPS were modestly below last year, operating cash flow declined, and the company faces a temporary Cyclospora-driven produce headwind (~100 bps to Q3 comps) plus restructuring and promotional investments. Overall, the positives — execution progress, margin/outlook beats, stronger opportunistic flow and improving customer/operator metrics — outweigh the near-term challenges, but the business remains early in its turnaround and guidance is prudently cautious.Positive Updates
Revenue and Traffic Growth
Net sales increased 1% year-over-year to $1.19 billion in Q2 FY2026; customer traffic grew 1.8% (vs 1.5% prior year), indicating improving store visitation.
Negative Updates
Comparable Store Sales and Basket Weakness
Comparable store sales declined 30 basis points (‑0.3%) in Q2; basket declined 2.1% year-over-year despite a sequential improvement of ~100 basis points from Q1, leaving comps still fragile.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue and Traffic Growth
Net sales increased 1% year-over-year to $1.19 billion in Q2 FY2026; customer traffic grew 1.8% (vs 1.5% prior year), indicating improving store visitation.
Read all positive updates
Company Guidance
Management raised the low end of its full‑year outlook and gave the following guidance: net new store openings of 30–33; net sales of $4.70–4.72 billion; comparable store sales of -0.5% to 0.0%; gross margin 29.8%–30.0%; approximately $20 million of incremental promotional investment for the year (tapering in H2); adjusted EBITDA $225–235 million; diluted adjusted EPS $0.51–0.55; and capital expenditures net of tenant improvement allowances of $170 million. For Q3 the company forecasts comps of -1.0% to 0.0%, gross margin 29.8%–30.0%, adjusted EBITDA $58–61 million and diluted adjusted EPS $0.14–0.16, while noting an expected ~100 basis‑point Q3 comp headwind from the Cyclospora produce impact and a plan to complete roughly 100 store refreshes by year‑end.Grocery Outlet Holding Financial Statement Overview
Summary
Income Statement
33
Negative
Balance Sheet
38
Negative
Cash Flow
52
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.74B | 4.69B | 4.37B | 3.97B | 3.58B | 3.08B |
| Gross Profit | 1.42B | 1.42B | 1.32B | 1.24B | 1.09B | 948.79M |
| EBITDA | -237.14M | -86.40M | 193.26M | 216.06M | 175.36M | 165.51M |
| Net Income | -381.25M | -224.91M | 39.47M | 79.44M | 65.05M | 62.31M |
Balance Sheet | ||||||
| Total Assets | 2.99B | 3.09B | 3.17B | 2.97B | 2.77B | 2.67B |
| Cash, Cash Equivalents and Short-Term Investments | 74.20M | 69.60M | 62.83M | 114.99M | 102.73M | 140.09M |
| Total Debt | 1.85B | 1.81B | 1.66B | 1.39B | 1.41B | 1.46B |
| Total Liabilities | 2.18B | 2.11B | 1.98B | 1.75B | 1.66B | 1.66B |
| Stockholders Equity | 816.59M | 983.66M | 1.20B | 1.22B | 1.11B | 1.01B |
Cash Flow | ||||||
| Free Cash Flow | -16.21M | 23.80M | -74.65M | 111.46M | 55.03M | 42.20M |
| Operating Cash Flow | 217.00M | 222.13M | 111.96M | 303.45M | 185.51M | 165.59M |
| Investing Cash Flow | -243.01M | -229.68M | -274.03M | -194.16M | -149.93M | -136.71M |
| Financing Cash Flow | 41.95M | 14.32M | 109.91M | -97.02M | -72.94M | 5.88M |
Grocery Outlet Holding Technical Analysis
Positive
12.21
Price Trends
11.84
Positive
10.71
Positive
9.48
Positive
Market Momentum
0.53
Negative
64.32
Neutral
82.81
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GO, the sentiment is Positive. The current price of 12.21 is below the 20-day moving average (MA) of 12.22, above the 50-day MA of 11.84, and above the 200-day MA of 9.48, indicating a bullish trend. The MACD of 0.53 indicates Negative momentum. The RSI at 64.32 is Neutral, neither overbought nor oversold. The STOCH value of 82.81 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 |
|---|---|---|---|---|---|---|---|
63 Neutral | $1.56B | -35.71 | -1.36% | ― | ― | ― | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
62 Neutral | $1.63B | 15.72 | 6.30% | 0.75% | 1.02% | 84.32% | |
61 Neutral | $1.95B | 20.10 | 7.15% | 1.72% | 4.50% | -3.08% | |
54 Neutral | $39.43B | 36.09 | 17.17% | 2.16% | 1.58% | -53.21% | |
54 Neutral | $6.57B | -465.33 | -2.78% | 4.73% | 2.26% | -106.73% | |
53 Neutral | $1.32B | -3.44 | -40.07% | ― | 5.12% | -4889.01% |
* Consumer Defensive Sector Average
GO
Grocery Outlet Holding
13.30
-1.05
-7.32%
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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.