Grocery Outlet (GO) Is Down 7.7% After Softer Comps Raise Questions About Turnaround Timing

• Recently, several banks revised their views on Grocery Outlet Holding after the company reported weaker November same-store sales and an 8.2% drop in EBT payment sales, highlighting pressure on its value-focused shopper base.
• Analysts acknowledged early progress under the new CEO’s turnaround plan, but questioned how quickly these initiatives can offset softening demand among lower-income customers.
• Next, we’ll examine how softer November comps and EBT weakness may alter Grocery Outlet’s investment narrative and expectations for its turnaround.

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Grocery Outlet Holding Investment Narrative Recap

To own Grocery Outlet today, you need to believe its discount model and new management team can translate store level improvements into sustainable comp growth and a return to profitability. The weak November same store sales and 8.2% EBT decline directly challenge the near term catalyst of a turnaround in value focused traffic, and reinforce the biggest current risk: that demand from lower income shoppers remains under pressure for longer.

The most relevant recent announcement is the November guidance cut, which trimmed 2025 comparable store sales expectations to 0.6% to 0.9%. That revision aligns with the softer November comps and suggests management is already baking a slower demand recovery into its outlook, which may temper enthusiasm around the turnaround but also sets a more cautious bar for upcoming execution milestones.

Yet investors should be aware that if lower income customer trends stay weak for longer...

Read the full narrative on Grocery Outlet Holding (it's free!)

Grocery Outlet Holding's narrative projects $5.7 billion revenue and $88.0 million earnings by 2028. This requires 8.3% yearly revenue growth and about a $79.9 million earnings increase from $8.1 million today.

Uncover how Grocery Outlet Holding's forecasts yield a $17.15 fair value, a 72% upside to its current price.

Exploring Other Perspectives

One member of the Simply Wall St Community currently pegs fair value at US$17.15, highlighting how individual views can differ from recent price action. Against this, the pressure on value focused shoppers and softer comps raises questions about how quickly any operational improvements might translate into the earnings recovery many are hoping for.

Explore another fair value estimate on Grocery Outlet Holding - why the stock might be worth just $17.15!

Build Your Own Grocery Outlet Holding Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Grocery Outlet Holding research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Grocery Outlet Holding research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Grocery Outlet Holding's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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