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Why Grocery Outlet Holding Corp. (GO) is a Top Value Stock for the Long-Term

For new and old investors, taking full advantage of the stock market and investing with confidence are common goals.

While you may have an investing style you rely on, finding great stocks is made easier with the Zacks Style Scores. These are complementary indicators that rate stocks based on value, growth, and/or momentum characteristics.

Why Investors Should Pay Attention to This Value Stock

Different than growth or momentum investors, value-focused investors are all about finding good stocks at good prices, and discovering which companies are trading under what their true value is before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to help pick out the most attractive and discounted stocks.

Grocery Outlet Holding Corp. (GO)

Founded in 1946 and headquartered in Emeryville, CA, Grocery Outlet Holding Corp. is a high-growth, extreme value retailer of quality, name-brand consumables and fresh products that are sold through a network of independently owned and operated stores. Notably, the company's stores offer a fun, treasure hunt shopping experience in an easy-to-navigate, “small-box” format of size 15,000-20,000 square feet. The company offers discounted, overstocked and closeout products from name brand and private label suppliers. Stores are operated by Entrepreneurial Independent Operators (“IOs”).

GO boasts a Value Style Score of B and VGM Score of A, and holds a Zacks Rank #3 (Hold) rating. Shares of Grocery Outlet Holding Corp. are trading at a forward earnings multiple of 34.3X, as well as a PEG Ratio of 2.9, a Price/Cash Flow ratio of 20X, and a Price/Sales ratio of 1X.

Value investors don't just pay attention to a company's valuation ratios; positive earnings play a crucial role, too. Five analysts revised their earnings estimate upwards in the last 60 days for fiscal 2022. The Zacks Consensus Estimate has increased $0.01 to $0.99 per share. GO has an average earnings surprise of 10%.

GO should be on investors' short lists because of its impressive earnings and valuation fundamentals, a good Zacks Rank, and strong Value and VGM Style Scores.


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