It's been a mediocre week for Grocery Outlet Holding Corp. (NASDAQ:GO) shareholders, with the stock dropping 10% to US$14.98 in the week since its latest quarterly results. It was a pretty bad result overall; while revenues were in line with expectations at US$1.1b, statutory losses exploded to US$0.24 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Grocery Outlet Holding after the latest results.
After the latest results, the 14 analysts covering Grocery Outlet Holding are now predicting revenues of US$4.72b in 2025. If met, this would reflect a credible 5.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 33% to US$0.23. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$4.74b and earnings per share (EPS) of US$0.40 in 2025. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a pretty serious reduction to EPS estimates.
Check out our latest analysis for Grocery Outlet Holding
Despite cutting their earnings forecasts,the analysts have lifted their price target 9.3% to US$15.62, suggesting that these impacts are not expected to weigh on the stock's value in the long term. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Grocery Outlet Holding at US$20.00 per share, while the most bearish prices it at US$11.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 8.0% growth on an annualised basis. That is in line with its 9.6% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 4.8% per year. So although Grocery Outlet Holding is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Grocery Outlet Holding. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Grocery Outlet Holding going out to 2027, and you can see them free on our platform here.
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Grocery Outlet Holding , and understanding them should be part of your investment process.
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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.