LSE:GRG

Stock Analysis Report

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Executive Summary

Greggs plc operates as a bakery food-on-the-go retailer in the United Kingdom. More Details


Snowflake Analysis

High growth potential and overvalued.


Similar Companies

Share Price & News

How has Greggs's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: GRG is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: GRG's weekly volatility (8%) has been stable over the past year.


Market Performance


7 Day Return

0.7%

GRG

5.1%

GB Hospitality

-0.4%

GB Market


1 Year Return

-16.5%

GRG

-21.0%

GB Hospitality

-10.0%

GB Market

Return vs Industry: GRG exceeded the UK Hospitality industry which returned -21% over the past year.

Return vs Market: GRG underperformed the UK Market which returned -10% over the past year.


Shareholder returns

GRGIndustryMarket
7 Day0.7%5.1%-0.4%
30 Day35.0%28.7%13.6%
90 Day22.7%20.8%6.4%
1 Year-16.5%-16.5%-18.7%-21.0%-6.4%-10.0%
3 Year39.2%30.6%-3.3%-11.9%1.6%-10.9%
5 Year51.2%33.9%16.9%-3.0%27.5%-1.5%

Long-Term Price Volatility Vs. Market

How volatile is Greggs's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Greggs undervalued compared to its fair value and its price relative to the market?

10.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: GRG (£17.38) is trading below our estimate of fair value (£19.33)

Significantly Below Fair Value: GRG is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: GRG is poor value based on its PE Ratio (438.1x) compared to the GB Hospitality industry average (30.5x).

PE vs Market: GRG is poor value based on its PE Ratio (438.1x) compared to the UK market (21.2x).


Price to Earnings Growth Ratio

PEG Ratio: GRG is poor value based on its PEG Ratio (3.5x)


Price to Book Ratio

PB vs Industry: GRG is overvalued based on its PB Ratio (6.2x) compared to the GB Hospitality industry average (1.6x).


Next Steps

Future Growth

How is Greggs forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

123.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: GRG's forecast earnings growth (123.8% per year) is above the savings rate (1.2%).

Earnings vs Market: GRG's earnings (123.8% per year) are forecast to grow faster than the UK market (27.2% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: GRG's revenue (15.1% per year) is forecast to grow faster than the UK market (6.8% per year).

High Growth Revenue: GRG's revenue (15.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: GRG's Return on Equity is forecast to be high in 3 years time (20.4%)


Next Steps

Past Performance

How has Greggs performed over the past 5 years?

0.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: GRG has a large one-off loss of £2.6M impacting its June 27 2020 financial results.

Growing Profit Margin: GRG's current net profit margins (0.4%) are lower than last year (6.9%).


Past Earnings Growth Analysis

Earnings Trend: GRG's earnings have grown by 0.9% per year over the past 5 years.

Accelerating Growth: GRG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: GRG had negative earnings growth (-94.7%) over the past year, making it difficult to compare to the Hospitality industry average (-13.1%).


Return on Equity

High ROE: GRG's Return on Equity (1.4%) is considered low.


Next Steps

Financial Health

How is Greggs's financial position?


Financial Position Analysis

Short Term Liabilities: GRG's short term assets (£172.1M) do not cover its short term liabilities (£280.8M).

Long Term Liabilities: GRG's short term assets (£172.1M) do not cover its long term liabilities (£246.5M).


Debt to Equity History and Analysis

Debt Level: GRG's debt to equity ratio (52.9%) is considered high.

Reducing Debt: Insufficient data to determine if GRG's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: GRG's debt is well covered by operating cash flow (42.9%).

Interest Coverage: GRG's interest payments on its debt are not well covered by EBIT (2.6x coverage).


Balance Sheet


Next Steps

Dividend

What is Greggs's current dividend yield, its reliability and sustainability?

1.18%

Forecast Dividend Yield


Dividend Yield vs Market

Notable Dividend: Unable to evaluate GRG's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate GRG's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if GRG's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if GRG's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: GRG is not paying a notable dividend for the UK market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of GRG's dividend in 3 years as they are not forecast to pay a notable one for the UK market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

9.3yrs

Average management tenure


CEO

Roger Whiteside (62 yo)

7.67yrs

Tenure

UK£2,530,080

Compensation

Mr. Roger Whiteside, OBE, has been the Chief Executive Officer of Greggs plc since February 4, 2013. Mr. Whiteside served as the Chief Executive Officer of Punch Taverns plc from August 2011 to February 1,...


CEO Compensation Analysis

Compensation vs Market: Roger's total compensation ($USD3.37M) is above average for companies of similar size in the UK market ($USD1.80M).

Compensation vs Earnings: Roger's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Roger Whiteside
CEO & Director7.67yrsUK£2.53m0.16%
£ 2.8m
Richard Hutton
Finance Director & Executive Director14.67yrsUK£1.20m0.093%
£ 1.6m
Jonathan Jowett
General Counsel & Company Secretary10.42yrsno datano data
Tony Rowson
Head of Retail8.08yrsno datano data
Emma Walton
Head of Peopleno datano datano data
Roisin Currie
Retail & People Directorno datano datano data

9.3yrs

Average Tenure

57yo

Average Age

Experienced Management: GRG's management team is seasoned and experienced (9.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Roger Whiteside
CEO & Director7.67yrsUK£2.53m0.16%
£ 2.8m
Richard Hutton
Finance Director & Executive Director14.67yrsUK£1.20m0.093%
£ 1.6m
Ian Durant
Independent Chairman7.5yrsUK£183.93k0.012%
£ 203.4k
Peter McPhillips
Independent Non-Executive Director6.67yrsUK£47.99k0.00099%
£ 17.4k
Sandra Turner
Senior Independent Director6.5yrsUK£56.41k0.00099%
£ 17.4k
Helena Ganczakowski
Independent Non-Executive Director6.83yrsUK£47.99k0.0011%
£ 19.2k
Kate Ferry
Independent Non-Executive Director1.42yrsUK£34.40k0.00056%
£ 9.8k

6.8yrs

Average Tenure

61yo

Average Age

Experienced Board: GRG's board of directors are considered experienced (6.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Greggs plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Greggs plc
  • Ticker: GRG
  • Exchange: LSE
  • Founded: 1939
  • Industry: Restaurants
  • Sector: Consumer Services
  • Market Cap: UK£1.758b
  • Shares outstanding: 101.13m
  • Website: https://corporate.greggs.co.uk

Number of Employees


Location

  • Greggs plc
  • Greggs House
  • Quorum Business Park
  • Newcastle upon Tyne
  • Tyne and Wear
  • NE12 8BU
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
GRGLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
GGGS.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
GRGLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992
41G1DB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992

Biography

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 its products through its shop...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/11/29 19:29
End of Day Share Price2020/11/27 00:00
Earnings2020/06/27
Annual Earnings2019/12/28


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.