GrowGeneration Beats on Q2 Earnings, Hikes '26 Adjusted EBITDA View

GrowGeneration Corp. GRWG reported a second-quarter 2026 loss of 3 cents per share, narrower than the Zacks Consensus Estimate of a loss of 4 cents. The loss also narrowed from 8 cents a year ago.

GRWG's Sales Mix Strengthens

GrowGeneration generated sales of $43.2 million in second-quarter 2026, which increased 5.5% year over year, led by strength in its commercial B2B business. The top line surpassed the Zacks Consensus Estimate of $43 million. 

Cultivation and Gardening sales increased to $34.9 million from $32.9 million in the prior-year quarter. Proprietary-brand sales rose to $13.8 million from $10.5 million, while non-proprietary brand sales declined to $21.1 million from $22.4 million.

Storage Solutions sales increased to $8.3 million from $8.1 million. Within Cultivation and Gardening, durable-product sales climbed to $9.8 million from $6.7 million, while consumables declined to $25.1 million from $26.2 million.

GrowGeneration’s Gross Margin Rise Y/Y in Q2

The cost of sales increased 5.2% year over year to $30.9 million in the quarter. Gross profit moved up 6.3% year over year to $12.3 million. The gross margin was 28.5% in the quarter under review compared with 28.3% in the prior-year quarter. The upside was driven by a higher mix of proprietary-brand products within the company’s Cultivation and Gardening segment.

Selling, general and administrative expenses increased 5% to $6.5 million in the quarter under review. However, total operating expenses fell 13.1% year over year to $14.7 million in the second quarter of 2026, aided by lower store operations and other operational expenses.

Adjusted EBITDA was $0.3 million in the quarter against the prior-year quarter’s negative $1.3 million.

GRWG’s Q2 Cash Position

At the end of the second quarter of 2026, GrowGeneration had cash and cash equivalents of $23.5 million, down from $30.4 million at the end of 2025. Inventory was $35.3 million, while prepaid and other current assets were $7.8 million at the quarter end. Total current liabilities, including accounts payable, accrued liabilities and payroll and payroll tax liabilities, were $25.6 million at the quarter’s end.

GRWG also continued its capital-return program during the quarter. The company repurchased 0.7 million shares at an average price of $1.38 per share, leaving approximately $9 million available under its share-repurchase authorization.

GrowGeneration Raises Adjusted EBITDA Outlook

GRWG reaffirmed its 2026 sales guidance of $162-$168 million. The company expects proprietary-brand sales to reach 40% of Cultivation and Gardening revenues by the year-end and projects full-year gross margin between 27% and 29%.

The company raised its full-year adjusted EBITDA outlook to $2-$3 million compared with its previously expected breakeven adjusted EBITDA. The upside is supported by the second-quarter performance, operating improvements and anticipated tariff-related benefits. For the third quarter of 2026, GRWG expects consolidated net sales of $44-$46 million, implying continued sequential growth.

GRWG Stock Price Performance

In the past year, GrowGeneration shares have gained 18% compared with the industry’s 21.4% growth.

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Performance of Agricultural Products Stock in Q2

Bunge Global SA BG reported second-quarter 2026 adjusted earnings of $2 per share, up 52.7% year over year. The figure missed the Zacks Consensus Estimate of $2.03 by 1.5%. 

Bunge’s sales surged 88.3% to $24.04 billion and beat the consensus mark of $23.49 billion by 2.3%. Sales and volumes increased across all segments.

GrowGeneration’s Zacks Rank & Other Stocks to Consider

GRWG currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some other top-ranked stocks from the Industrial Products sector are Helios Technologies, Inc HLIO and Fastenal Company FAST. HLIO and FAST carry a Zacks Rank #2 at present.

The Zacks Consensus Estimate for Helios Technologies’ 2026 earnings is pegged at $3.09 per share. The company has a trailing four-quarter average earnings surprise of 13.1%. Helios Technologies’ shares have gained 53.5% in a year.

The Zacks Consensus Estimate for Fastenal’s 2026 earnings is pinned at $1.26 per share, which indicates year-over-year growth of 15%. The company’s shares have grown 7.7% in a year. 

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This article originally published on Zacks Investment Research (zacks.com).

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