Telsey raises Grocery Outlet stock price target on turnaround progress

DA Davidson raised Grocery Outlet's (GO) price target to $14 from $12, citing improved value offerings and better-than-expected Q3 sales. The company reported adjusted earnings of $0.16 per share and revenue of $1.18B, beating estimates. Despite a 65% stock surge in six months, some analysts suggest overvaluation. GO operates as a U.S. discount retailer.

Grocery Outlet reported Q3 fiscal 2026 net sales of $1.18B, up 0.9%, with comparable-store sales rising 0.5%. Net income increased to $13.3M, but adjusted net income declined. The company opened 14 stores and raised its comparable-store sales forecast for the year.

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Wells Fargo raised its price target for Grocery Outlet (GO) to $13.00 from $11.00, citing a constructive 2027 outlook with expected sales growth and rising margins. The stock, currently at $14.02, trades above the new target and InvestingPro’s Fair Value of $12.09. GO reported Q3 earnings of $0.16 per share, beating estimates, with revenue at $1.18 billion, up 0.9% year-over-year. Despite challenges with margin pressure, the stock has surged 78.6% in six months.

Grocery Outlet (GO) reported Q3 2026 net sales of $1.18B, up 0.9%, with comparable store sales rising 0.5%. Adjusted EBITDA was $59.4M, and adjusted EPS was $0.16. Gross margin declined 40bps due to promotions, freight costs, and a Cyclospora outbreak. The company opened 14 new stores and updated FY2026 guidance, expecting net sales of $4.70B-$4.72B and adjusted EBITDA of $225M-$229M. Management highlighted sequential improvements in traffic and October sales momentum.

Grocery Outlet (GO) reported Q3 2026 with positive comparable store sales growth of 50 basis points, driven by a 2.4% traffic increase. EBITDA declined to $59.4M from $66.7M YoY, and adjusted EPS fell to $0.16 from $0.21. The company faced challenges like a Cyclospora outbreak and higher construction costs, but saw improvements in e-commerce and opportunistic product sales. Management expects Q4 SG&A pressure and plans to focus on value and fresh offerings to rebound basket growth.