Greggs‘ (LSE:GRG) shares are on a roll once more, so to talk. The baker was as soon as one of many FTSE 250‘s strongest performers, delivering stratospheric gross sales development that despatched its valuation sky excessive. Then got here a drop in client spending in 2024 that slowed underlying revenues to a trickle and devastated the share value.
As a shareholder, I’ve thought of chucking up the sponge a number of occasions and promoting up. I’m happy I didn’t — Greggs’ share value has surged for the reason that begin of 2026 and continues to choose up steam.
So what’s occurred? And might the FTSE 250 baker proceed surging?
Greggs’ shares rise once more!
At £19.84 as we speak, Greggs’ share value remains to be down 19% over a three-year interval. However a pointy pickup in buying and selling has seen it rise nearly a 3rd in worth in simply six months.
It’s surging once more on Wednesday (30 September) after elevating forecasts for the total yr. It’s up nearly 6% on the day after the announcement.
Improved buying and selling efficiency in current months and continued sturdy value management now leads us to anticipate a modestly improved end result for 2026.
Whole gross sales had been up 7.7% within the 13 weeks to 26 September, Greggs mentioned. This pushed revenues development over a 39-week horizon to 7.4%.
In the meantime, like-for-like (LFL) gross sales from company-managed shops rose 3.4% final quarter. Over 39 weeks, corresponding takings had been up 2.6%. And critically, gross sales momentum retains bettering (LFL gross sales development was 2.1% within the first half).
Greggs mentioned that its “improved buying and selling displays the success of continued menu innovation together with extra settled climate.” Demand for iced drinks like matcha lattes, and more healthy meals comparable to its relaunched salad traces, has been particularly sturdy, the corporate famous.
Q&A time
One query has been haunting Greggs and its share value over the previous couple of years. Analysts have been asking “has the UK reached ‘Peak’ Greggs”? and suggesting the general public is tiring of its candy and savoury items.
Wednesday’s replace goes an extended technique to answering this query, for my part. A long time-old favourites like sausage rolls, doughnuts and pies stay as in style as ever. However importantly, Greggs has its finger on the heart beat in the case of altering client tastes, with a gentle move of menu additions proving extraordinarily in style.
Administration additionally stays extremely dedicated to its retailer enlargement programme, one other highly effective assertion of the agency’s development potential. It’s opened 95 shops of its deliberate 100-110 for 2026, taking Greggs nearer to its goal of three,500.
Can the share value preserve rising?
It’s vital to emphasize that Greggs isn’t out of the woods simply but. Inflation is spiking, that means shoppers are feeling the pinch once more. This autumn can be forecast to be particularly moist, which may additional influence takings.
But wanting long term, I’m optimistic Greggs and its share value will steadily recuperate from final yr’s lulls. Ongoing streamlining will increase earnings as retailer rollouts in excessive footfall journey hubs proceed. The baker additionally has additional to discover within the profitable supply and night channels. And naturally extra blockbuster menu additions are within the pipeline.
One last factor. Greggs’ shares additionally stay filth low-cost, which may additionally assist additional value beneficial properties. Its ahead price-to-earnings (P/E) ratio is simply 14.9 occasions, effectively under the 10-year common of 22-23.
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Royston Wild owns shares in Greggs.
