GO: Future Outlook Will Balance Moderated Guidance With Margin Improvement Expectations

Analysts have trimmed their price target on Grocery Outlet Holding by approximately $1.00 per share. This reflects a slightly higher discount rate and more conservative revenue growth expectations, partly offset by improved margin assumptions and a lower projected future P E multiple.

What's in the News

• Updated buyback data shows no shares repurchased between June 29, 2025 and September 27, 2025, under the November 9, 2021 authorization. The program is now fully executed at 4,371,397 shares repurchased for $90.7 million in total (company filing).
• A newer buyback plan announced on November 5, 2024 also recorded no repurchases over the same June 29 to September 27, 2025 period, leaving that authorization effectively unused so far (company filing).
• The company lowered its fiscal 2025 outlook, tightening net sales guidance to $4.70 billion to $4.72 billion and cutting expected comparable store sales growth to a range of 0.6% to 0.9%, down from the prior range of 1.0% to 2.0% (company guidance).

Valuation Changes

• The fair value estimate was reduced modestly from $12.00 per share to $11.00 per share, reflecting a slightly more conservative outlook.
• The discount rate was increased meaningfully from about 8.35% to about 9.59%, implying a higher required return and greater perceived risk.
• Revenue growth was trimmed slightly from roughly 6.45% to about 5.99% annually, indicating a modestly slower growth trajectory.
• The net profit margin was raised from about 1.17% to roughly 1.60%, signaling improved profitability expectations despite slower growth.
• The future P/E multiple was lowered significantly from about 23.5x to roughly 16.6x, contributing to the reduced fair value estimate.