Showing us how it’s done
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Edison Investment Research Limited
London, UK, 2 April 2024
Edison issues outlook on Greggs (GRG): Showing us how it’s done The second full year of Greggs’ five-year growth plan to double revenue by FY26 should be marked down as very successful, especially so given the challenging external environment. Unlike many consumer-facing companies, high selling price inflation was accompanied by volume growth, leading to good market share gains. The consumer is responding well to new initiatives to grow revenue in new dayparts and digital channels. Profitability was well-managed with better recovery of input cost inflation than FY22. We look for more of the same in FY24, which will be a significant year from a capital investment perspective, and beyond. The updated DCF-based valuation, which incorporates the roll forward and updating of our estimates and WACC (reduced from 10% to 9% to incorporate lower bond yields and equity risk premium), has increased to £30.20 (£29.70 previously). Prospective EV/sales and P/E multiples for FY24 of 1.4x and 21.9x, respectively, are at the mid/upper end of its more recent average multiples. Click here to view the full report. All reports published by Edison are available to download free of charge from its website About Edison: As a content-led investor-relations business, Edison helps companies stand out and meet the right shareholders. Edison’s integrated investor relations solution combines expert analyst content, digital targeting and active investor engagement. This drives liquidity and valuations by building bigger, better informed and more engaged investor audiences globally. Edison has a proven history of increasing liquidity and valuations for its clients. Edison’s content can be viewed by all investors, anywhere in the world. Edison is authorised and regulated by the Financial Conduct Authority. Edison is not an adviser or broker-dealer and does not provide investment advice. Edison’s reports are not solicitations to buy or sell any securities. For more information, please contact Edison: Russell Pointon +44 (0)20 3077 5700 consumer@edisongroup.com Milo Bussell +44 (0)20 3077 5700 consumer@edisongroup.com Learn more at www.edisongroup.com and connect with Edison on: LinkedIn https://www.linkedin.com/company/edison-group-/ Twitter www.twitter.com/Edison_Inv_Res YouTube http://www.youtube.com/edisonitv
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1871451 02-Apr-2024
