Greggs (LON:GRG) Releases Quarterly Earnings Results

Greggs (LON:GRG) announced its earnings results on Wednesday. The company reported GBX 55.10 earnings per share for the quarter, Digital Look Earnings reports. Greggs had a net margin of 5.93% and a return on equity of 20.97%.

Here are the key takeaways from Greggs’ conference call:

• First-half profit and cash flow improved: Total sales rose 7.2%, company-managed like-for-like sales increased 2.1%, and profit before tax climbed 19.7% to £76 million. Operating cash flow grew 18.3%, while the company maintained its 19p interim dividend.
• Greggs said its value-led brand continues to gain market share, with share of food-to-go visits rising 0.3 percentage points to 8.7% despite an overall market volume decline. Menu innovation, including iced drinks, matcha, salads and the Chicken Roll, is intended to support demand across different weather conditions and consumer trends.
• Expansion remains profitable and disciplined: New shops are achieving or exceeding the targeted 25% mature cash return on investment, with limited evidence of cannibalization. The company expects 100–110 net new shops in 2026 and sees potential for at least 3,500 U.K. locations over the longer term, supported by smaller Bite Size and Greggs Express formats.
• Management expects full-year profit to be broadly flat year over year despite the strong first half, primarily because Derby operating costs will increase by about £10 million in the second half. Derby’s cost annualization and the launch of Kettering are also expected to constrain profit progress in 2027 before supply-chain leverage improves from 2028.
• Capital expenditure guidance was reduced to £180 million from £200 million as major supply-chain projects near completion and contingency is released. The resulting recovery in free cash generation could create scope for additional shareholder returns once cash reaches the company’s target level, potentially through special dividends or share buybacks.

Greggs Stock Down 6.4%

Shares of LON GRG opened at GBX 1,901.40 on Friday. The company has a market cap of £1.94 billion, a price-to-earnings ratio of 15.94, a PEG ratio of 3.39 and a beta of 1.15. The company has a quick ratio of 0.88, a current ratio of 0.52 and a debt-to-equity ratio of 74.16. The firm’s fifty day moving average is GBX 1,647.50 and its 200 day moving average is GBX 1,622.95. Greggs has a 52 week low of GBX 1,407.20 and a 52 week high of GBX 2,046.

Key Headlines Impacting Greggs

Here are the key news stories impacting Greggs this week:

• Positive Sentiment: Greggs reported a 20% increase in first-half profit, with grocery sales growth and its value-focused strategy supporting higher market share. The results prompted strong investor interest and helped drive a reported 15% jump in the shares. Greggs first-half profit up 20%
• Positive Sentiment: JPMorgan raised its Greggs price target from GBX 2,050 to GBX 2,210 and maintained an “outperform” rating, indicating confidence in further earnings and share-price upside. JPMorgan broker action
• Positive Sentiment: Berenberg increased its target from GBX 2,090 to GBX 2,200 and upgraded its stance to “buy,” adding to the positive analyst momentum. Berenberg broker action
• Positive Sentiment: Greggs is exploring international growth, including demand for its sausage rolls in the Canary Islands. While early-stage, overseas expansion could provide a longer-term growth opportunity. Greggs Canary Islands expansion
• Neutral Sentiment: Jefferies reiterated a “hold” rating, suggesting the recent operational progress may already be reflected in the valuation. Jefferies reiterates Hold
• Negative Sentiment: Deutsche Bank reaffirmed its “sell” rating and set a GBX 1,330 target, materially below the current trading range. This bearish target may be contributing to profit-taking after the recent rally. Deutsche Bank broker action

Wall Street Analysts Forecast Growth

Several analysts have recently weighed in on the stock. Shore Capital Group restated a “hold” rating on shares of Greggs in a research report on Tuesday, May 12th. Berenberg Bank upped their target price on shares of Greggs from GBX 2,090 to GBX 2,200 and gave the stock a “buy” rating in a research report on Thursday. UBS Group reissued a “buy” rating and issued a GBX 2,200 target price on shares of Greggs in a research note on Monday, May 11th. Jefferies Financial Group restated a “hold” rating and set a GBX 1,610 price target on shares of Greggs in a research report on Wednesday. Finally, Deutsche Bank Aktiengesellschaft reiterated a “sell” rating and issued a GBX 1,330 price objective on shares of Greggs in a report on Thursday. Four research analysts have rated the stock with a Buy rating, three have assigned a Hold rating and one has given a Sell rating to the company. According to MarketBeat.com, Greggs has a consensus rating of “Hold” and a consensus target price of GBX 1,862.86.

Insider Buying and Selling at Greggs

In other Greggs news, insider Richard Smothers bought 1,615 shares of the business’s stock in a transaction that occurred on Tuesday, May 19th. The shares were bought at an average cost of GBX 17 per share, with a total value of £274.55. Corporate insiders own 0.62% of the company’s stock.

About Greggs

Greggs is a leading UK food-on-the-go retailer with more than 2,700 shops nationwide and approximately 33,000 employees across the business.

As a food-on-the-go retailer, Greggs specialises in daily fresh shop-made sandwiches, and savouries baked fresh in the shop ovens throughout the day. These are further complemented by popular products and ranges including freshly ground coffee, breakfast, confectionery and evening menu items. Greggs also offers a healthier options range which includes a selection of gluten-free, vegan-friendly and lower calorie products.