Tasty, good value, and full of potential. This doesn’t just describe one of Greggs’ (GRG) pasties, but the bakery chain’s shares. After a lockdown-hit 2020, when its shops were shuttered and sales plunged, the company made notable steps forward in 2021 and is confidently pursuing an ambitious growth target to double revenue by 2026.
Tip style
Growth
Risk rating
Medium
Timescale
Long Term
Bull points
- Aim to double revenue over five years looks achievable
- Special dividend expected this year
- Strong pipeline of new shops
Bear points
- Inflation poses a short-term challenge
- Prices were already raised at the end of 2021
Greggs’ strategy is centred around expanding outlets and pushing forward with home delivery and evening trading. Progress is being made on these fronts, and when combined with solid fundamentals, the long-term investment case looks attractive.