I’ve been watching the ( ) share price for months, wondering whether this was a good time to buy it. Britain’s favourite bakery chain has turned itself into a national treasure, supplying traditional fayre like sausage rolls and steak bakes, without feeling stodgy or old-fashioned itself. Unlike so many retailers, the cost-of-living crisis did it a favour, as cash-strapped shoppers saw a trip to Greggs as an affordable treat.
Greggs has been marketed brilliantly, from its clothing range (with Primark) to its legendary vegan sausage rolls. I’m not sure how many it actually sold, but everybody was talking about them. FTSE 250 growth star Management’s aiming to lift total store numbers from 2,500 to 3,500 and is looking beyond the high street to stations, airports, supermarkets and retail parks.
It’s also testing evening openings. At the same time, it’s swift to close underperforming outlets, which keeps margins high. Given that I’m such a fan, why didn’t I ? One of the first metrics I look at when deciding whether to buy a stock is the price-to-earnings ratio, and that was always high at more than 20 times.
The price-to-sales ratio, which compares a company’s share price to its revenues, was also pricey, on the high side at 1.6, but not dangerously so. Especially since sales have been growing fast, jumping almost 20%, from £1.
513m in 2022 to £1.810m in 2023. The board’s been willing to reward loyal shareholders too.
A of 2.15% is modest but management’s .