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Connecticut-based Stadium Capital Management reduced its stake in Grocery Outlet Holding Corp by 877,860 shares in the third quarter—representing a net position change of about $10.9 million.
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The transaction represented an 11.7% change relative to the fund’s overall 13F assets under management.
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The move also marked a full exit for the fund, which reported holding no shares of Grocery Outlet at quarter-end.
On November 14, Stadium Capital Management disclosed a complete exit from Grocery Outlet Holding Corp. (NASDAQ:GO), reducing its position by 877,860 shares in an estimated $10.9 million change.
According to a U.S. Securities and Exchange Commission (SEC) filing published November 14, Stadium Capital Management sold out of Grocery Outlet Holding during the third quarter. The fund had previously reported holding 877,860 shares in the prior period and now reports a zero-share position. The estimated transaction value, based on quarterly average prices, was $10.9 million.
The complete exit brings the position from 10% of the fund’s AUM as of the previous quarter to zero as of September 30.
Top holdings after the filing:
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NYSE:BLDR: $22.2 million (23.7% of AUM)
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NYSE:BC: $19.5 million (20.8% of AUM)
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NASDAQ:SNBR: $18.4 million (19.6% of AUM)
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NYSE:NSP: $13 million (13.9% of AUM)
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NYSE:LCII: $8.9 million (9.6% of AUM)
As of Friday’s market close, shares of Grocery Outlet Holding Corp. were priced at $11.13, down 48% over the past year and well underperforming the S&P 500, which is up 14% in the same period.
|
Metric |
Value |
|---|---|
|
Revenue (TTM) |
$4.6 billion |
|
Net Income (TTM) |
($4.4 million) |
|
Market Capitalization |
$1.1 billion |
|
Price (as of market close Friday) |
$11.13 |
Grocery Outlet Holding Corp. operates a large network of independently run discount grocery stores across the United States, leveraging a flexible sourcing strategy to deliver value-priced products. The company’s business model centers on procuring surplus and closeout goods, which supports its competitive pricing and appeals to cost-conscious consumers. This approach enables Grocery Outlet to maintain a differentiated position in the grocery retail sector, focusing on affordability and variety for its target market.
A complete exit from a top holding often signals that an investor’s confidence in the turnaround timeline has meaningfully shifted—and Grocery Outlet’s uneven post-IPO trajectory helps explain why. Shares remain nearly 50% lower over the past year and more than 75% below their peak. The retailer’s latest quarter showed modest top-line growth but continued bottom-line strain: Net sales rose 5.4% to $1.2 billion, yet net income fell by more than half to $11.6 million and adjusted EBITDA slipped to $66.7 million, or 5.7% of sales.
Stadium Capital’s full divestiture—previously a 10% portfolio position—reduces exposure to a business still navigating a large restructuring plan, softer comparable-store sales, and higher SG&A. Management is leaning on a refresh program to reinvigorate growth, with early pilots showing encouraging results, but a broad rollout brings execution risk as cost pressures remain elevated.
For long-term investors, the reset may ultimately create an opportunity if the operational rebuild delivers—but near-term visibility remains limited.
