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GO, Grocery Outlet

Grocery Outlet is a growth-oriented extreme value retailer of quality, name-brand consumables and fresh products sold primarily through a network of independently operated stores.

An ever-changing assortment of "WOW!" deals, complemented by everyday staple products, generates customer excitement and encourages frequent visits from bargain-minded shoppers.

Our flexible buying model allows us to offer quality, name-brand opportunistic products at prices generally 40% to 70% below those of conventional retailers.

Latest annual: FY2026 10-K

GO · Grocery Outlet

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2026

$4.7B

+7.3% YoY · 13% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $4.7B 5-yr avg $3.9B

Gross margin 30% 5-yr avg 31%

Operating margin −8.0% 5-yr avg 1.3%

ROIC −24% 5-yr avg 2%

Owner-earnings margin 4% 5-yr avg 3%

Free cash flow margin 1% 5-yr avg 1%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What it is: Revenue is Non-Perishable (62%) and Perishable (38%).
What moves the needle: Gross margin has run about 30% and operating margin about 2.7% through the cycle, a solid spread between what it charges and what the product costs to make. The operating margin has swung widely — from −4.7% to 3.7% — on a steadier 30% gross margin, so what moves it sits below the gross line, in operating spend and one-off charges more than in the cost of the product itself. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median 5%, above 15% in 0 of 8 years). By owner earnings: roughly 3% of revenue reaches owners as cash, consistently. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 10-K →

Non-Perishable is 62% of revenue, with Perishable the other meaningful line at 38%.

Revenue by product line, FY2026

Non-Perishable62%$2.9B
Perishable38%$1.8B

From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2017–2026

realized figures from each filing · older years to the left

2017’17	2018’18	2019’19	2021’21	2022’22	2023’23	2024’24	2026’26	TTMTTMApr 2026
									Income statement
$2.1B	$2.3B	$2.6B	$3.1B	$3.6B	$4.0B	$4.4B	$4.7B	$4.7B	RevenueRevenue
30%	30%	31%	31%	31%	31%	30%	30%	30%	Gross marginGross mgn
25%	24%	25%	25%	28%	28%	28%	28%	29%	SG&A / revenueSG&A/rev
$77M	$82M	$68M	$107M	$95M	$126M	$78M	($222M)	($377M)	Operating incomeOp. inc.
3.7%	3.6%	2.7%	3.4%	2.7%	3.2%	1.8%	−4.7%	−8.0%	Operating marginOp. mgn
$21M	$16M	$15M	$107M	$65M	$79M	$39M	($225M)	($382M)	Net incomeNet inc.
20%	27%	8%	—	14%	24%	30%	—	—	Effective tax rateTax rate
									Cash flow & returns
$85M	$106M	$133M	$181M	$186M	$303M	$112M	$222M	$216M	Operating cash flowOp. cash
$43M	$45M	$48M	$55M	$78M	$88M	$108M	$6M	$6M	DepreciationDeprec.
$19M	$34M	$38M	($19M)	$10M	$105M	($46M)	$430M	$583M	Working capital & otherWC & other
$71M	$65M	$97M	$125M	$130M	$169M	$187M	$198M	$191M	CapexCapex
3.4%	2.8%	3.8%	4.0%	3.6%	4.3%	4.3%	4.2%	4.0%	Capex / revenueCapex/rev
$42M	$60M	$85M	$126M	$107M	$215M	$4M	$216M	$210M	Owner earningsOwner earn.
2.0%	2.6%	3.3%	4.0%	3.0%	5.4%	0.1%	4.6%	4.4%	Owner earnings marginOE mgn
$14M	$41M	$36M	$56M	$55M	$134M	($75M)	$24M	$25M	Free cash flowFCF
0.7%	1.8%	1.4%	1.8%	1.5%	3.4%	−1.7%	0.5%	0.5%	Free cash flow marginFCF mgn
—	—	—	—	$0	$0	$61M	$0	$0	AcquisitionsAcquis.
$1M	$154M	$4M	$434K	$100K	$15K	$0	$0	$0	Dividends paidDiv. paid
—	—	—	$0	$3M	$6M	$81M	$0	—	BuybacksBuybacks
15%	5%	5%	8%	6%	7%	3%	-12%	-24%	ROICROIC
5%	5%	2%	12%	6%	7%	3%	-23%	-47%	Return on equityROE
5%	−46%	2%	12%	6%	7%	3%	−23%	−47%	Retained to equityRetained/eq
									Balance sheet
$6M	$21M	$28M	$105M	$103M	$115M	$63M	$70M	$59M	Cash & investmentsCash+inv
—	$4M	$5M	$3M	$6M	—	$16M	$15M	$12M	ReceivablesReceiv.
—	$198M	$219M	$245M	$334M	$350M	$394M	$382M	$387M	InventoryInvent.
—	$98M	$119M	$114M	$138M	$209M	$176M	$177M	$200M	Accounts payablePayables
—	$104M	$105M	$134M	$203M	$141M	$234M	$219M	$199M	Operating working capitalOper. WC
—	$240M	$271M	$382M	$467M	$517M	$504M	$498M	$489M	Current assetsCur. assets
—	$151M	$209M	$233M	$281M	$384M	$350M	$364M	$382M	Current liabilitiesCur. liab.
—	1.6×	1.3×	1.6×	1.7×	1.3×	1.4×	1.4×	1.3×	Current ratioCurr. ratio
—	$748M	$748M	$748M	$748M	$748M	$783M	$634M	$476M	GoodwillGoodwill
—	$1.4B	$2.2B	$2.5B	$2.8B	$3.0B	$3.2B	$3.1B	$3.0B	Total assetsAssets
—	$857M	$460M	$460M	$451M	$293M	$478M	$493M	$489M	Total debtDebt
—	$836M	$432M	$355M	$349M	$178M	$415M	$423M	$430M	Net debt / (cash)Net debt
$427M	$300M	$745M	$922M	$1.1B	$1.2B	$1.2B	$984M	$807M	Shareholders’ equityEquity
0.1%	0.5%	1.2%	1.2%	0.9%	0.8%	0.2%	0.2%	0.2%	Stock comp / revenueSBC/rev
									Per share
68.3M	68.5M	81.9M	98.5M	100M	101M	99.6M	98.0M	98.4M	Shares out (diluted)Shares
$30.37	$33.37	$31.27	$31.84	$35.72	$39.37	$43.88	$47.85	$48.05	Revenue / shareRev/sh
$0.30	$0.23	$0.19	$1.08	$0.65	$0.79	$0.40	$-2.30	$-3.88	EPS (diluted)EPS
$0.61	$0.88	$1.04	$1.28	$1.07	$2.14	$0.04	$2.20	$2.13	Owner earnings / shareOE/sh
$0.20	$0.60	$0.44	$0.57	$0.55	$1.33	$-0.75	$0.24	$0.26	Free cash flow / shareFCF/sh
$0.02	$2.24	$0.04	$0.00	$0.00	$0.00	$0.00	$0.00	$0.00	Dividends / shareDiv/sh
$1.04	$0.94	$1.19	$1.27	$1.30	$1.68	$1.87	$2.02	$1.94	Cap. spending / shareCapex/sh
$6.25	$4.38	$9.11	$9.37	$11.08	$12.09	$12.02	$10.04	$8.20	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+5.2%/yr	+8.5%/yr
Owner earnings / share	+15.4%/yr	+11.5%/yr
Capital spending / share	+7.7%/yr	+9.8%/yr
Book value / share	+5.4%/yr	+1.4%/yr

The record, charted

FY2017–2026

Each measure over its full record; the current point and the worst year marked.

Share count

98Mpeak FY2023

ROIC

−12%low FY2026

Gross margin

30%low FY2024

Net debt ÷ owner earnings

2.0×peak FY2024

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$216Mowner earningsvs.($225M)net incomelow FY2024

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2017FY2026

Owner-earnings bridge

FY2021–FY2026cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2026 the business earned $216M of owner earnings, the operating cash left after the $6M it takes just to hold its position. It put $192M more into growth; free cash flow, after that spending, was $24M.

	FY2026	FY2024	FY2023	FY2022	FY2021
Reported net income	($225M)	$39M	$79M	$65M	$107M
Depreciation & amortizationnon-cash charge added back	+$6M	+$108M	+$88M	+$78M	+$55M
Stock-based compensationreal costnon-cash, but a real cost	+$10M	+$11M	+$31M	+$33M	+$38M
Working capital & othertiming of cash in and out, other non-cash items	+$430M	−$46M	+$105M	+$10M	−$19M
Cash from operations	$222M	$112M	$303M	$186M	$181M
Maintenance capital expenditurethe spending needed just to hold position and volume	−$6M	−$108M	−$88M	−$78M	−$55M
Owner earnings	$216M	$4M	$215M	$107M	$126M
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	−$192M	−$78M	−$81M	−$52M	−$69M
Free cash flow	$24M	($75M)	$134M	$55M	$56M
Owner-earnings marginowner earnings ÷ revenue	5%	0%	5%	3%	4%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the maintenance capital it must spend to hold its position (here about $6M, roughly its depreciation, the rate its assets wear out). The other $192M of its capital spending is growth it chose, not upkeep it owed; charged only with the maintenance it must do, the business earns well more than the year's free cash flow shows. The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $10M), owner earnings is nearer $206M.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2026 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? —

Interest expense not tagged in the data

What this means
No usable interest-expense line was tagged in the filing data, but the balance sheet carries real net debt — so the interest burden here is unknown, not absent. Read the debt on the net-debt check below.
How heavy is the debt, net of cash? $423M

Net debt against an operating loss

Cash $70M − debt $493M

What this means
Netting $70M of cash and short-term investments against $493M of debt leaves $423M owed, with no operating profit this year to measure it against — understand that combination before anything else about the company. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 24d

Tight

DSO 1 + DIO 43 − DPO 20 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 5%

Below average through the cycle

8-yr median, range -12%–15%; -12% latest = NOPAT ($175M) ÷ invested capital $1.4B

Industry peers: median 10%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 8 years (it ran -12% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 3%

Thin through the cycle

8-yr median margin, range 0%–5%; latest $216M = operating cash $222M − maintenance capex $6M

Industry peers: median 2%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 5% of revenue this year, a 3% median across 8 years. It chose to put $192M more into growth, so free cash flow this year was $24M — the gap is investment, not weakness. Treating stock comp as the real expense it is (less $10M of SBC) leaves $206M.
Are earnings backed by cash? $222M

Loss, but cash-generative

Net income ($225M) · cash from operations $222M

In the filing’s words And the filing leans heavily on adjusted, non-GAAP earnings — steering you off the GAAP figure just where the cash is not backing it. Read the reconciliation in the notes before taking the adjusted number.

What this means
The company reported a net loss, so a conversion ratio isn't meaningful. What matters then is whether operations still threw off cash, here, they did.

How is the cash used?

Where do the earnings go? 0%

Reinvests most of it

Dividends + buybacks $0 ÷ Owner Earnings $216M

What this means
Of $216M Owner Earnings, $0 (0%) went back to shareholders, $0 dividends, $0 buybacks. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 32.51×

Expanding

Capex $198M ÷ depreciation $6M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 1 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $4.7B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Miss

Current ratio ≥ 2× · 1.37×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Miss

Debt ≤ working capital · $493M vs $134M WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Near

A profit every year (8-yr record) · 1 loss year

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · 6 of 8 yrs

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Miss

Earnings +33% over the record · −304%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-0.36/share (latest year $-2.27), the averaged base the calculator's gate runs on, and book value is $9.94/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2017–2026

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 7 of 8

What this means
Lost money in 1 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 0 of 7 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 3% → 0% (3-yr avg ends)

What this means
Through the cycle the operating margin slipped — about 3% early to 0% lately, median 3% — competition or costs are biting in.
Reinvestment, incremental ROIC returns capital

What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
Owner earnings growth +9%/yr

What this means
Owner earnings grew about 9% a year over the record.
Worst year 2026 · −4.7% op. margin

What this means
Operations went underwater in 2026, understand why before trusting the good years.
Share count +4.1%/yr

What this means
The share count is rising, dilution works against you on a per-share basis.
Dividend record paid

What this means
Paid a dividend in 6 of the years on record.

Does AI threaten the moat?

Moderate contestability

AI is likely to reshape costs and some products here without clearly contesting or sparing the core moat; how the company itself frames it is the tell.

The question is whether a moat the record shows as durable outlasts a technology that lowers the cost of part of what the firm sells. The durability is read in the record above, the filing's own framing of AI beside it; the industry label decides nothing on its own.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Apr 4, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$489M

Cash & short-term investments$59M
Receivables$12M
Inventory$387M
Other current assets$31M

Current liabilities$382M

Debt due within a year$15M
Accounts payable$200M
Other current liabilities$167M

Current ratio1.28×all current assets ÷ what's due · Graham looked for 2×

Quick ratio0.27×stricter: inventory excluded

Cash ratio0.15×strictest: cash alone against what's due

Working capital$107Mthe cushion left after near-term bills

Debt due this year vs. cash$15M due · $59M cash covered by cash on hand, no refinancing forced · both figures from the Apr 4, 2026 balance sheet

Revenue, latest quarter vs. a year ago+3.6%the freshest read on whether the business is still growing

Current ratio, recent quarters1.3× → 1.3×

Deeper floors

Tangible book value$255Mequity stripped of goodwill & intangibles

Net current asset value($1.7B)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$1.8B$1.3B of it operating leases; with finance leases, “total fixed claims” below reaches $1.8B (annual-report basis)

From the company's latest filing.

Lease obligations

the lease note, SEC EDGAR →

Debt by another name. What the business owes on the property, aircraft, stores and equipment it rents rather than owns is a fixed claim due on a schedule; added back to the debt, it is the true leverage. That ladder, operating and finance leases together, and what it adds to the debt on the page above.

Operating leasesFinance leases

'26$172M

'27$187M

'28$184M

'29$184M

'30$179M

later$941M

Lease payments by year, scaled to the largest; “later” is everything beyond year five, shown apart. These are the contractual cash payments, before the interest the filing imputes back out to the balance-sheet liability.

Due in the next 12 months$172Ma fixed cash payment, owed whether or not the business has a good year

Total lease payments$1.8Bevery year plus the tail, undiscounted: the full cash the leases will take

On the balance sheet$1.3Bthe present value of those payments, the recognised lease liability

True leverage: debt plus leases

On-balance-sheet debt$493M

Lease obligations (present value)$1.3B

Total fixed claims on the business$1.8B

Counting the leases the way Buffett does, the fixed claims on this business come to $1.8B, of which the leases are 73%, more than the debt itself. The lease wall above and the debt schedule together are the calendar of what must be paid, and when.

Lease ladder read from the ASC 842 tags in the company’s Jan 3, 2026 annual report and reconciled: the yearly buckets sum to the undiscounted total, which less the imputed interest equals the balance-sheet liability; a ladder that doesn’t tie out is withheld.

How the cash was used, 2017–2026

Over the record, the business generated $1.3B of operating cash; how management split it reads as a reinvestor, most operating cash is plowed back into the business.

Reinvested$1.0B · 79%
Dividends$159M · 12%
Buybacks$91M · 7%
Retained (debt / cash)$35M · 3%

Returned to owners$250M
29% of the owner earnings the business produced over the span, $159M as dividends and $91M as buybacks.
Average price paid for buybacks$20.75
Across the years where the filing reports a share count, 4M shares were bought for $91M, about $20.75 each.
Net change in share count44.0%
The diluted count rose from 68M to 98M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
Dividend record$0.00/sh
Paid in 6 of the years on record. It was cut at least once along the way.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 8-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$712M23% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity64%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$61Mover 8 years buying other businesses, against $1.0B of capital spent building

$149M written down across 1 year (2026): goodwill the company has already conceded it overpaid for, charged against earnings. A write-down costs no cash (the cash went out when the deal was signed), but it is management marking its own past judgment to market.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 8-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	—	$4.0M	−$515k	$126M
2022	—	$5.3M	$8.5M	$107M
2023	Robert J. Sheedy, Jr.	$6.2M	$8.0M	$215M
2024	—	$4.8M	$1.9M	$4M
2024	Robert J. Sheedy, Jr.	$9.5M	$200k	$4M
2026	Jason Potter	$9.5M	$6.3M	$216M
2026	—	$876k	−$2.7M	$216M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years. A dash under the name means the filing tags the figure without naming the officer.

Insider ownership<1%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio300:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$10M
The slice of the business handed to employees in shares this year, 0% of revenue. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Grocery Outlet is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2017–2026.

2 of the 4 tests turned up something to look into; the other 2 came back clean.

Look hereDid the share count rise anyway?44.0%
Diluted shares grew 44.0% over 2017–2026, even as the company spent $91M on buybacks. The repurchases were outrun by issuance — to staff, in a raise, or in a deal — and the filing says which; owners' slice still shrank. Read the buyback line beside this one, not on its own.
Look hereAre "one-time" charges a yearly habit?4 of 8 years
Management took an impairment or write-down in 4 of the last 8 years, $287M in all. Taken across the majority of the record, the "one-time" label is wearing thin — ask whether these are past deals coming due rather than genuinely isolated events. Read it beside the goodwill the company still carries.

And these came back clean

Is it less profitable than it was?
Did reported profit become cash?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

Peers, Food & Drug Retailing

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
SFMSprouts Farmers	$8.8B	36%	5.3%	30%	5%
ARKOARKO Corp.	$7.6B	—	1.3%	10%	1%
IMKTAIngles Markets Incorporated	$5.3B	24%	3.6%	9%	2%
WMKWeis Markets Inc.	$5.0B	—	2.7%	8%	2%
GOGrocery Outlet	$4.7B	30%	2.9%	5%	3%
VLGEAVillage Super Market Inc.	$2.3B	28%	2.1%	10%	2%
DNUTKrispy Kreme Inc.	$1.5B	—	0.6%	0%	-4%
NGVCNatural Grocers by Vitamin Cottage Inc.	$1.3B	—	2.7%	15%	2%
Group median	—	29%	2.7%	9%	2%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Grocery Outlet has delivered.

Grocery Outlet’s latest year runs above its own through-cycle margin — the reported figure may flatter a peak. So the tool opens on the through-cycle base, Graham’s averaging cutting both ways; clear the toggle below to read the latest year exactly as reported.

Today’s price $

Through the cycle, Grocery Outlet earns about $148M on its 3.2% median owner-earnings margin. This year’s 4.6% margin runs above that; the reported figure may flatter a peak you'd be paying on. Normalize, below, values the price on that through-cycle figure rather than the latest year. It comes pre-checked here for that reason, the same rule that already normalizes a trough; clear it to price the year as filed.

Base Normalize · through-cycle ($148M) Net of stock comp (−$9M) Steady-state · maintenance capex ($210M)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’26−1%/yr

Owner-earnings growth, delivered—

Owner-earnings yield—

P/E (3-yr earnings ’23–’26)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow $25M on 99M shares outstanding, per the 10-Q cover, as of 2026-05-07; net debt $430M. The base opens on the through-cycle figure (the latest year sits above the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. Capex ($191M) runs well above depreciation ($6M), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $210M, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh GO against another business →

The owners of GO: the meeting and the votes →

Cite: Owner Scorecard, "Grocery Outlet (GO), the owner's record," https://ownerscorecard.com/c/GO, data as of 2026-07-09.

Manual order: ← GNW its page in the Manual GOGO →

Industry order: ← CVS the Food & Drug Retailing chapter GRDN →