Grocery Outlet Holding (GO) AI Stock Analysis

• Market Cap: $1.43B
• Dividend Yield: N/A
• Average Volume (3M): 2.80M
• Price to Earnings (P/E): 184.4
• Beta (1Y): 0.64
• Revenue Growth: 8.47%
• EPS Growth: -85.17%
• Country: US
• Employees: 1,692
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Grocery Stores
• EPS (TTM): 0.23
• Shares Outstanding: 98,103,294
• 10 Day Avg. Volume: 2,381,662
• 30 Day Avg. Volume: 2,803,228
• 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: 2.06
• Enterprise Value/Revenue: 0.65
• Enterprise Value/Gross Profit: 2.15
• Enterprise Value/Ebitda: 17.89
• 1Y Price Target: $18.29
• Price Target Upside: 25.10% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 9

• Rating: 58 Neutral
• Price Target: $15.00 ▲(2.60% Upside)

Grocery Outlet Holding's overall stock score is primarily impacted by its financial performance challenges, including high leverage and declining profitability. The technical analysis indicates a bearish trend, further weighing down the score. However, the positive sentiment from the earnings call, driven by strong financial performance and strategic initiatives, provides some optimism for future growth. The high P/E ratio suggests overvaluation, which also affects the overall score.

Positive Factors

Store Expansion

Strategic store expansion supports long-term growth by increasing market presence and leveraging local market knowledge through independent operators.

Improved Gross Margin

Higher gross margins indicate improved inventory management and cost control, enhancing profitability and competitive positioning.

Talent Acquisition

Strengthening leadership with experienced talent can drive strategic initiatives and operational improvements, supporting long-term success.

Negative Factors

High Leverage

High leverage can limit financial flexibility and increase risk, particularly if cash flow challenges persist, impacting long-term stability.

Cash Flow Challenges

Declining cash flow limits the company's ability to invest in growth opportunities and manage debt, posing a risk to financial health.

Net Income Decline

A decline in net income reflects challenges in profitability, which could impact future investment and expansion capabilities.

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, as well as grocery, general merchandise, health and beauty care, frozen foods, and beer and wine. As of August 09, 2022, it had 425 stores in eight states. The company was founded in 1946 and is headquartered in Emeryville, California.

How the Company Makes Money

Grocery Outlet makes money primarily through the sale of grocery products at discounted prices. The company's revenue model is based on purchasing excess inventory from manufacturers and distributors at lower costs, which allows them to sell these goods at competitive prices while maintaining healthy profit margins. Key revenue streams include sales from grocery items, private label products, and seasonal promotions. Additionally, Grocery Outlet benefits from a unique business model that involves partnerships with independent operators, who manage individual store locations and contribute to the overall sales performance. These partnerships enable the company to expand its footprint while leveraging local market knowledge, further driving revenue growth.

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.

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 2019	Dec 2018
Income Statement
Total Revenue	4.51B	4.37B	3.97B	3.58B	2.56B	2.29B
Gross Profit	1.37B	1.32B	1.24B	1.09B	787.10M	695.40M
EBITDA	164.92M	193.23M	214.97M	173.24M	118.49M	129.52M
Net Income	8.13M	39.47M	79.44M	65.05M	15.42M	15.87M
Balance Sheet
Total Assets	3.32B	3.17B	2.97B	2.77B	2.19B	1.38B
Cash, Cash Equivalents and Short-Term Investments	55.19M	62.83M	114.99M	102.73M	28.10M	21.06M
Total Debt	1.76B	1.66B	1.39B	1.41B	1.25B	857.37M
Total Liabilities	2.14B	1.98B	1.75B	1.66B	1.44B	1.08B
Stockholders Equity	1.19B	1.20B	1.22B	1.11B	745.38M	299.95M
Cash Flow
Free Cash Flow	-51.20M	-74.65M	111.46M	38.44M	32.57M	37.88M
Operating Cash Flow	195.09M	111.96M	303.45M	185.51M	132.84M	105.81M
Investing Cash Flow	-254.90M	-274.03M	-194.16M	-149.93M	-108.02M	-73.55M
Financing Cash Flow	47.94M	109.91M	-97.02M	-72.94M	-17.78M	-17.00M

Grocery Outlet Holding Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 14.62
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 14.62 is below the 20-day moving average (MA) of 15.59, below the 50-day MA of 16.69, and below the 200-day MA of 15.03, indicating a bearish trend. The MACD of -0.39 indicates Positive momentum. The RSI at 33.00 is Neutral, neither overbought nor oversold. The STOCH value of 26.19 is Neutral, 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
VLGEA	―	$418.54M	8.43	11.60%	3.11%	3.76%	12.17%
ACI	―	$10.04B	10.93	32.04%	3.25%	2.08%	-1.63%
IMKTA	―	$1.29B	24.24	3.58%	0.95%	-7.96%	-64.67%
WMK	―	$1.59B	16.41	7.86%	2.11%	2.49%	15.99%
NGVC	―	$886.26M	21.03	23.58%	1.22%	8.51%	40.83%
Sector *	―	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
GO	―	$1.43B	184.36	0.68%	―	8.47%	-85.17%

Grocery Outlet Holding Corporate Events

Grocery Outlet Appoints New Chief Store Operations Officer

On August 26, 2025, Grocery Outlet Holding Corp. announced the appointment of Frank Kerr as Executive Vice President, Chief Store Operations Officer, effective September 15, 2025. Frank Kerr, with extensive experience in grocery retail, previously held leadership roles at Lidl US and Save A Lot, where he contributed to significant market share gains and operational improvements. His appointment is expected to enhance Grocery Outlet’s store operations and support its mission of providing exceptional value to customers, while driving sustainable growth and profitability.

The most recent analyst rating on (GO) stock is a Hold with a $19.50 price target. To see the full list of analyst forecasts on Grocery Outlet Holding stock, see the GO Stock Forecast page.

Grocery Outlet’s Earnings Call: Optimism Amid Challenges

Grocery Outlet Holding’s recent earnings call painted a picture of cautious optimism. The company reported strong financial performance that exceeded expectations, alongside strategic initiatives that are making headway and positive consumer feedback. However, this optimism was tempered by challenges such as ongoing systems implementation issues and a notable decrease in net income, which balanced the overall sentiment.

Grocery Outlet Reports Q2 2025 Financial Results

Grocery Outlet Holding Corp., a prominent retailer in the extreme value sector, specializes in offering quality, name-brand consumables and fresh products through a network of independently operated stores across the United States.