My Reasoning To Soon Be Purchasing Greggs Shares (£GRG)


(John Campbell) #21

And don’t forget we all munchies, and the addition of the drive through is interesting.


(Alex Sherwood) #22

It looks like they’re not done yet, apparently a ham & pineapple bake’s next on the list.

Greggs tease possibility of controversial new bake - sparking furious debate


(Happy St Patrick’s Day ) #23

New suggestion then:

Attention seeking bakers


#24

https://uk.finance.yahoo.com/news/millennials-snapped-greggs-stock-launched-vegan-sausage-roll-060020433.html - neat pr strategy @Viktor :+1:

(Also has some demographics on the userbase I hadn’t seen before:
“Freetrade has around 11,000 users in the UK. Their average age is 30 and over 80% of users are aged 18 to 34.”)


#25

(Yogesh) #26

Spot on analysis. Gregg is more than 8% up today. From first post it is almost 50% up.
FromNewbieToPro - What’s your latest pick :grinning:


(Matthew) #27

HL.com note.

“Stunning” like-for-like growth of 9.6% in company-managed shops led the analysts to admit underestimating Greggs.

Consequently, they upgraded their below-consensus full-year 2019 CPTP forecast by approximately 10% to £102m , earnings per share of 79.0p .

Dividend per share was now seen rising by 16% to 41.6p in 2019, before climbing by a further 7% to 44.4p in 2020.

The broker’s analysts commented that the boost to the baker’s already strong trading followed high levels of media interest and “extensive publicity” surrounding the launch of the group’s ‘vegan friendly’ sausage roll at the start of the financial year, despite the derision directed at the pastry by one Piers Morgan.

“Customer transactions have increased and with the volume growth evident across the savoury category the strong trading has also, we believe, generated considerable operational gearing benefits across both the store base and manufacturing infrastructure,” they said in a research note sent to clients.

Whilst Greggs has stated that trading “eased slightly” through February, which analysts estimate to mean a drop from approximately 11% growth in January to roughly 8% growth, trading is still on course to be ahead of market expectations, ShoreCap said.

I own no (zero) Gregg’s shares and have no view on these comments. However I thought that it was worth sharing this information for those watching this stock.

Best of luck.
Matthew


(Chris) #28

Its a fascinating company, they’re growth is impression but my word their share price has significantly out performed their revenue & sales growth. But honestly, their growing cost base would worry me. The balance sheet is solid which is refreshing for UK companies.

7th March will be telling for them. They have a lot of expectation to meet!

But isn’t it nice that we can celebrate a UK company growing nicely, especially a high street one too!


(Andrew Clark) #29

Agreed, they’re the UK’s Amazon, Uber, Apple…

:slight_smile:


(Harihar Patel) #30

Greggs is solid, always has been. Their products are fairly priced as well in stores, which keeps customers coming back. I bought Greggs at £10 a while ago, it’s a buy and hold forever stock.


(Jack Bailey) #31

Do you really think they are going to keep growing?


(Chris) #32

No doubt it is solid. Balance sheet is as clean as you could want it to be. I’m just concerned that the price s very high based on expected forward growth that I don’t think is there. PE is 30 right now so expectations are really high and market share needs to growth a lot to hit those expectations


(Harihar Patel) #33

sterling is weak, so it’s going to get even more overvalued.


(Alex Sherwood) #34

Interesting, how does the value of sterling affect Gregg’s stock price?


(Harihar Patel) #35

Greggs has nearly 100% of it’s revenue from the UK, so if sterling rises, Greggs will rise as well. The whole UK domestic market will rise with sterling, and international dollar earners like BP, Diageo etc will fall.


(Dave Smith) #36

But the share price is in Sterling, If both Share price and earnings are sterling the P/E ratio should stay about the same, all else being equal


#37

I will start posting videos on terms like this and meanings in a simple and clear way on my YT channel. Shameless plug… soz.

https://www.youtube.com/channel/UCbSC5PeMNizu_rw9_zOjgEw


(Jonny) #38

Surely that would only benefit those holding Gregg shares internationally?


#39

All the tourists who come to buy sausage rolls will now be able to buy fewer, of course.


(Alex Suss) #40

No, movements in FX affect mean stock prices have to move up and down because demand from international investors changes. Stock movements are based on currency strength, fundamentals of the company, and hope, fear and greed from speculators.