Shares of discount grocery store chain Grocery Outlet (NASDAQ:GO) jumped 5.4% in the morning session after the company reported a "beat and raise" quarter. Second quarter results surpassed analysts' expectations for comparable store sales, revenue, and earnings per share (EPS). Comparable store sales, which measures the increase in sales in stores that have been open for a year or more (to exclude newly-opened stores), grew over 9% in the quarter, smashing expectations of slightly under 6%. Also, EPS beat by 29%, driven by the comparable stores sales growth but also improved gross margin and strong expense control.
Looking ahead, the company raised its comparable store sales, revenue, gross margin, adjusted EBITDA, and EPS guidance for the full year. Overall, it was a great quarter for the company.
Is now the time to buy Grocery Outlet? Access our full analysis report here, it's free.
What is the market telling us:
Grocery Outlet's shares are not very volatile than the market average and over the last year have had only three moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
Grocery Outlet is up 23.3% since the beginning of the year, but at $35.37 per share it is still trading 21.3% below its 52-week high of $44.92 from August 2022. Investors who bought $1,000 worth of Grocery Outlet's shares at the IPO in June 2019 would now be looking at an investment worth $1,240.
Do you want to know what moves the stocks you care about? Add them to your StockStory watchlist and every time a stock we cover moves more than 5%, we provide you with a timely explanation straight to your inbox. It's free and will only take you a second.