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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#4093
Positioning
Market Dominance
Retail Trade
Retail
$1.6B
Eric J. Lindberg
Grocery Outlet Holding Corp. owns and operates a network of independently operated stores in the United States. As of March 1, 2022, it had approximately 410 stores in California, Washington, Oregon, Pennsylvania, Idaho, Nevada, and New Jersey. The company was founded in 1946 and is headquartered in Emeryville, California.
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = GO ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$ARCO Arcos Dorados Holdings Inc. | 73 | 85 | 89 | 65 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$IMKTA INGLES MARKETS INC | 70 | 73 | 89 | 76 | 11.3x | 4.1x | 6.9% | 4.1% | 24.3% | 2.8% | 1.9% | -3.4% | 1.1% | 33.0x | $1.2B | VS | |
$SGU STAR GROUP, L.P. | 69 | 82 | 79 | 63 | - | - | -25.2% | -10.6% | 28.1% | -6.3% | -5.4% | -7.8% | 6.1% | 57.0x | $396M | VS | |
$EZPW EZCORP INC | 68 | 77 | 82 | 89 | 7.2x | 4.2x | 12.0% | 6.2% | 59.1% | 11.6% | 8.5% | 10.5% | 0.0% | 52.0x | $764M | VS | |
$HTHT H World Group Ltd | 68 | 91 | 44 | 84 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$DDL Dingdong (Cayman) Ltd | 68 | 86 | 82 | 57 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$SBH Sally Beauty Holdings, Inc. | 68 | 83 | 92 | 77 | 5.1x | 2.3x | 32.0% | 6.6% | 51.5% | 8.4% | 4.9% | -1.0% | 0.0% | 178.0x | $934M | VS | |
$SPH SUBURBAN PROPANE PARTNERS LP | 67 | 80 | 90 | 53 | - | 13.0x | 0.4% | -3.5% | 61.7% | 2.1% | -5.7% | 2.2% | 7.1% | 190.0x | $1.2B | VS | |
$IHG INTERCONTINENTAL HOTELS GROUP PLC /NEW/ | 67 | 63 | 81 | 67 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$ROST ROSS STORES, INC. | 67 | 63 | 55 | 83 | 25.2x | 16.5x | 34.8% | 13.3% | 28.0% | 11.6% | 9.1% | 10.4% | 1.0% | 26.0x | $51.6B | VS | |
$GO Grocery Outlet Holding Corp. | 35 | 34 | 36 | 17 | 30.7x | 19.8x | 2.8% | 1.0% | 30.5% | 1.5% | 0.7% | 3.8% | 0.0% | 144.0x | $1.6B | ||
| SECTOR BENCH | - | - | - | - | - | 21.4x | 9.1x | 9.6% | 3.6% | 37.3% | 4.4% | 2.4% | 3.7% | 0.0% | 0.7x | - | REF |
Grocery Outlet Holding Corp. (GO) receives a "Avoid" rating with a composite score of 35.2/100. It ranks #4093 out of 7,333 stocks in our coverage universe and carries a 1-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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Lagging peers — losers tend to keep underperforming
Fair valuation relative to peers
Weak fundamentals — higher risk of value trap
Average volatility — neutral timing signal
Aggressive spending — empire-building risk, dilutive growth
Below-average composite — caution warranted
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Relative valuation derived from Retail Trade sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for GO.
View All Ratings| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 34 | 19 | +15ALPHA |
| MOMENTUM | 17 | 11 | +6ALPHA |
| VALUATION | 36 | 31 | +5NEUTRAL |
| INVESTMENT | 22 | 4 | +18ALPHA |
| STABILITY | 53 | 57 | -4NEUTRAL |
| SHORT INT | 18 | 5 | +13ALPHA |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROIC 1.1% vs WACC 6.1% (spread -5.0%)
GM 30% vs sector 37%, OM 2% vs sector 4%
Capital turnover 0.70x
Rev growth 4%, 7yr history
Interest coverage N/A, Net debt/EBITDA 29.7x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
We rate Grocery Outlet Holding Corp. (GO) as Avoid with a composite score of 35.2/100 at a current price of $10.10. The stock falls in the bottom quintile, and the multi-factor weakness suggests a high probability of continued underperformance.
Grocery Outlet Holding Corp. holds a top-quartile position (#0 of 50) within the Retail Trade sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 35.2/100 places it at rank #4093 in our full universe.
No Moat
Medium
Poor
Fair Value
Stable competitive position in a defensive sector.
Leverage of 144% D/E amplifies downside risk.
Weak momentum suggests persistent institutional selling pressure.
Below-average quality raises earnings sustainability concerns.
Grocery Outlet Holding Corp. represents a avoid based on multi-factor quantitative performance.
Our quantitative model flags Grocery Outlet Holding Corp. with an Avoid rating, assigning a composite score of 35.2/100 and 1 out of 5 stars. Ranked #4093 of 7,333 stocks, GO falls in the bottom tier across key factors. Historically, stocks with this profile have faced elevated risk of underperformance and capital loss.
GO's quality score of 34/100 is below average, suggesting challenges with profitability or capital efficiency. The company reports a return on equity of 2.8% (sector avg: 9.6%), gross margins of 30.5% (sector avg: 37.3%), net margins of 0.7% (sector avg: 2.4%). Investors should examine whether management is actively addressing these weaknesses or if they reflect structural industry headwinds.
With a value score of 36/100, GO appears somewhat expensive relative to its fundamentals. Key valuation metrics include a P/E ratio of 30.69x, an EV/EBITDA of 19.77x, a P/B ratio of 0.85x. Investors paying a premium here are likely betting on above-average growth or margin expansion to justify current prices.
Grocery Outlet Holding Corp.'s investment score of 22/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of 3.8% vs. a sector average of 3.7% and a return on assets of 1.0% (sector: 3.6%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
Grocery Outlet Holding Corp. is experiencing notably weak momentum with a score of just 17/100. The stock has underperformed its peers and is trending below major moving averages. Revenue growth stands at 3.8% year-over-year, while a beta of 0.15 reflects its sensitivity to broader market moves. While deep momentum weakness can occasionally present value opportunities, it often reflects deteriorating fundamentals or structural headwinds that may persist.
With a stability score of 53/100, GO exhibits average financial resilience. Key stability metrics include a beta of 0.15 and a debt-to-equity ratio of 144.00x (sector avg: 0.7x). While the balance sheet is not a major concern, the stock is subject to typical market volatility and may experience sharper drawdowns during risk-off episodes.
Grocery Outlet Holding Corp.'s short interest score of 18/100 reveals significant bearish positioning, suggesting institutional investors are actively betting against the stock. Specific risk factors include elevated leverage (D/E: 144.00x), small-cap liquidity risk. At $1.6B (small-cap), GO carries meaningful risk and is best suited for investors with high risk tolerance who have thoroughly evaluated the bear thesis.
Grocery Outlet Holding Corp. is a small-cap company in the Retail Trade sector, ranked #0 of 50 in its sector (100th percentile) and #4093 of 7,333 overall (44th percentile). Key comparisons include ROE of 2.8% trailing the 9.6% sector median and operating margins of 1.5% below the 4.4% sector average. This top-quartile standing reflects exceptional competitive strength relative to Retail Trade peers.
While GO currently exhibits a AVOID profile, superior opportunities exist within the RETAIL TRADE sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
View Top Retail Trade Alpha →Quant Factor Profile
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Improvement in Momentum (17) would have the largest impact on the composite score.
EV/EBITDA 117% ABOVE SECTOR MEDIAN
ROE 71% BELOW SECTOR MEDIAN
Gross Margin 18% BELOW SECTOR MEDIAN
Goldman Sachs analyst Kate McShane maintains Grocery Outlet Holding (NASDAQ:GO) with a Sell and lowers the price target from $12 to $9.
EMERYVILLE, Calif., Feb. 18, 2026 (GLOBE NEWSWIRE) -- Grocery Outlet Holding Corp. (NASDAQ: GO) (“Grocery Outlet”) today announced that its financial results for the fourth quarter and full fiscal 2025 year will be released after the market close on Wednesday, March 4, 2026. The company will host a conference call at 4:30pm ET (1:30pm PT) to discuss the results. A live audio webcast of the conference call will be available online at https://investors.groceryoutlet.com. A webcast replay will be a
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Above 50MA
37.18%
Net New Highs
+51081