Grocery Outlet (NASDAQ:GO) Announces Earnings Results

Grocery Outlet (NASDAQ:GO) announced its quarterly earnings data on Wednesday. The company reported $0.19 EPS for the quarter, missing the consensus estimate of $0.21 by ($0.02), FiscalAI reports. The business had revenue of $1.22 billion during the quarter, compared to analysts’ expectations of $1.23 billion. Grocery Outlet had a negative net margin of 0.10% and a positive return on equity of 5.86%. Grocery Outlet’s revenue was up 10.7% on a year-over-year basis. During the same quarter in the previous year, the firm earned $0.15 earnings per share. Grocery Outlet updated its FY 2026 guidance to 0.450-0.550 EPS.

Here are the key takeaways from Grocery Outlet’s conference call:

• CEO Jason Potter said Q4 results were “unacceptable” and attributed the comp deceleration to three drivers: a meaningfully tougher consumer environment, an erosion in customer value perception, and supply-chain constraints that reduced the opportunistic “treasure hunt” items that drive units-per-transaction.
• Management is rebuilding the opportunistic mix—adding DC capacity, improving forecasting and merchandising (now unified under Matt Deli)—and reports the opportunistic sales mix is up roughly 200 basis points and shipments up ~150 bps, with early monthly comp improvement after promotional activity.
• The company will close 36 stores (24 in the East), expects ~$12 million annualized adjusted EBITDA benefit, but took large Q4 charges including $109.8 million long‑lived asset impairments and a $149 million goodwill impairment and expects ~$57 million cash closure costs this year.
• FY‑2026 guidance is cautious—comps of -2% to flat, net sales of $4.6B–$4.72B, adjusted EBITDA of $220M–$235M, and adjusted EPS of $0.45–$0.55—reflecting store closures, promotional spend and the loss of the 2025 53rd week.
• The company launched a strategic review of UGO and a broader store program (150 refreshes planned and 30–33 net new openings in 2026) with stricter underwriting and targeted IRRs of ~25%–30% for new cohorts, signaling a more disciplined growth approach.

Grocery Outlet Trading Down 0.9%

Shares of NASDAQ GO opened at $8.79 on Thursday. Grocery Outlet has a fifty-two week low of $8.73 and a fifty-two week high of $19.41. The company has a debt-to-equity ratio of 0.40, a quick ratio of 0.25 and a current ratio of 1.30. The company has a market cap of $862.65 million, a price-to-earnings ratio of -175.80, a PEG ratio of 1.80 and a beta of 0.50. The business’s 50 day moving average price is $9.79 and its 200-day moving average price is $12.74.

Key Headlines Impacting Grocery Outlet

Here are the key news stories impacting Grocery Outlet this week:

• Positive Sentiment: Revenue and margins improved year-over-year: Q4 sales rose ~10.7% to $1.22B and gross profit increased ~11.5%; operating cash flow and cash balances also grew, which supports near-term liquidity. Read More.
• Neutral Sentiment: The company noted an extra 53rd week in the period (complicates year‑over‑year comps) and announced a formal “Optimization Plan” to improve execution, profitability and cash flow — the plan could help margins long term but may include near‑term charges/costs. Read More.
• Negative Sentiment: Reported EPS missed estimates: Q4 EPS $0.19 vs. consensus ~$0.21 and revenue slightly below forecasts — investors view the miss as a sign of margin pressure. Read More.
• Negative Sentiment: FY2026 guidance came in below Street expectations: EPS guide of $0.45–$0.55 (consensus ~$0.77) and revenue guide of ~$4.6–4.7B vs. ~4.8B consensus — this weaker outlook is the primary driver of investor concern. Read More.
• Negative Sentiment: GAAP/one‑time items drove large reported operating and net losses in some reports (Quiver highlighted an operating loss and a GAAP diluted loss per share), amplifying the market reaction; shares reportedly fell sharply after the release. Read More.
• Negative Sentiment: Notable insider and institutional selling reported in the quarter (including large fund reductions), which can add selling pressure following the weak report and guide. Read More.

Institutional Trading of Grocery Outlet

Institutional investors and hedge funds have recently made changes to their positions in the business. T. Rowe Price Investment Management Inc. boosted its stake in shares of Grocery Outlet by 54.0% during the fourth quarter. T. Rowe Price Investment Management Inc. now owns 15,763,945 shares of the company’s stock valued at $159,216,000 after purchasing an additional 5,528,722 shares during the period. Mackenzie Financial Corp lifted its holdings in Grocery Outlet by 0.5% during the 4th quarter. Mackenzie Financial Corp now owns 4,709,721 shares of the company’s stock valued at $47,757,000 after buying an additional 22,418 shares in the last quarter. Dimensional Fund Advisors LP boosted its position in Grocery Outlet by 5.0% in the 3rd quarter. Dimensional Fund Advisors LP now owns 4,619,851 shares of the company’s stock valued at $74,149,000 after buying an additional 221,693 shares during the period. Marshall Wace LLP boosted its position in Grocery Outlet by 0.5% in the 3rd quarter. Marshall Wace LLP now owns 4,577,371 shares of the company’s stock valued at $73,467,000 after buying an additional 20,819 shares during the period. Finally, State Street Corp grew its stake in Grocery Outlet by 11.8% in the 4th quarter. State Street Corp now owns 4,375,319 shares of the company’s stock worth $44,191,000 after acquiring an additional 462,212 shares in the last quarter. 99.87% of the stock is currently owned by institutional investors.

Wall Street Analysts Forecast Growth

Several research firms have commented on GO. DA Davidson reiterated a “neutral” rating and set a $15.00 price objective on shares of Grocery Outlet in a research report on Thursday, December 4th. Jefferies Financial Group restated a “hold” rating and set a $7.00 target price (down from $18.00) on shares of Grocery Outlet in a research report on Thursday. Deutsche Bank Aktiengesellschaft set a $11.00 price target on Grocery Outlet in a research report on Thursday, January 8th. Wells Fargo & Company downgraded Grocery Outlet from an “overweight” rating to an “equal weight” rating and decreased their price objective for the company from $16.00 to $10.50 in a research report on Wednesday, February 25th. Finally, UBS Group reiterated a “neutral” rating and issued a $11.50 target price on shares of Grocery Outlet in a report on Thursday, December 18th. One analyst has rated the stock with a Buy rating, ten have given a Hold rating and two have assigned a Sell rating to the stock. According to data from MarketBeat.com, Grocery Outlet presently has an average rating of “Reduce” and a consensus target price of $11.73.

About Grocery Outlet

Grocery Outlet Holding Corp. (NASDAQ: GO) is a specialty discount retailer that offers consumers deeply discounted groceries by purchasing excess inventory, closeouts, and overstocks from manufacturers and distributors. Headquartered in Emeryville, California, the company operates two primary banners—Grocery Outlet and Fresh2Go—with a combined footprint of more than 400 stores. Its product assortment spans fresh produce, meat, dairy, bakery items, household staples, natural and organic offerings, and select specialty products, all sold at significant markdowns compared to conventional supermarkets.

The company’s unique buying model enables it to source inventory through opportunistic purchases of surplus freight, discontinued items, and closeout deals, which it then passes on as savings to its customers.