Greggs plc·Consumer Defensive

Greggs plc remains challenged by weak U.K. consumer sentiment and cost inflation, and now faces the fallout from the conflict in the Middle East. On the plus side, CapEx peaked in 2025 and should decrease by £90 million this year and more in 2027. This will be a tailwind to free cash flow. Despite macro headwinds, Greggs isn't losing market share, and the valuation is attractive with shares trading on a trailing P/E ratio of less than 13.

Greggs PLC (LSE:GRG) is gaining ground on its competitors even as its sales volumes disappoint, according to RBC Capital Market, which sees the current weakness as cyclical rather than structural. The baker's recent trading update showed like-for-like sales growth of just 1.6% at the start of 2026, with pricing of around 4% implying volume declines of 2.5%.

Greggs plc (GGGSY) Q4 2025 Earnings Call Transcript

Greggs PLC has little to shout about after a year of slowing trade, according to Shore Capital, which says the bakery chain now faces a period of flat earnings and rebuilding its cash buffer. Preliminary results for 2025 on Tuesday showed total sales up 6.8% to £2.15 billion, with like-for-like growth of 2.4%.

Greggs PLC (LSE:GRG), the UK bakery chain, left its full-year profit guidance unchanged after like-for-like sales rose 1.6% in the first nine weeks of 2026, with total sales up 6.3%. The company said it expected to deliver profits at a similar underlying level to 2025, though it warned that any improvement would depend on a recovery in consumer spending.

Greggs plc trades at a historically low P/E of 11 with a >4% dividend yield, offering compelling value ahead of March 3 earnings. Despite macro headwinds and tax pressures, GGGSF maintains strong profitability with a 61.7% gross margin and 27.9% ROE, supported by aggressive expansion. Recent growth is driven by new locations, while like-for-like sales remain sluggish; upcoming earnings must show inflection in organic sales and FCF rebound.
Greggs plc operates as a bakery food-on-the-go retailer in the United Kingdom. It offers a range of fresh and frozen bakery products, sandwiches, and drinks. The company sells products to franchise and wholesale partners for sale in their own outlets. It is also involved in the property holding, non-trading, and trustee businesses. The company operates approximately 2,200 shops and 375 franchise locations. Greggs plc was founded in 1939 and is headquartered in Newcastle upon Tyne, the United Kingdom.
Consumer Defensive
Grocery Stores
33,146
2021-12-23
1.17