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Published February 17, 2025
Investors discovered there was something rotten at Grocery Outlet after the discount grocer released a sour finance report. Once investors got a sniff of the truth – that a tech roll-out gone wrong was costing the Company millions – shareholders quickly tossed out their shares, sending Grocery Outlet’s stock price plummeting 19%. Now, some of those shareholders have filed a class-action lawsuit to recover their losses.
In November 2023, Grocery Outlet executives told investors the Company was undergoing a “systems transitions” would hurt financial results for the remainder of the year. But, Company executives assured investors the disruption would be done by the end of 2023.
Investors first got a whiff that something was wrong when, in February 2024, the Company announced the transition as taking “longer than anticipated,” so first quarter financial results had also gone bad.
But investors lost their patience in May 2024 when the Company released a dire financial report in which it admitted the transition continued to hurt finances. Analysts were stunned and investors quickly sold off their shares.
Now, some of those investors are joining the lawsuit.