Right here’s what £10,000 invested in Greggs shares in the beginning of this 12 months is value now… – Imperial Wire

Greggs (LSE: GRG) shares had a poor 2025. The excessive avenue food-to-go chain fell round 25% and is down 40% over three years. That’s painful for holders of the FTSE 250 inventory — however is it a shopping for alternative for individuals who don’t personal it?

At a time when many metropolis centres look more and more desolate, Greggs’ blue-and-yellow signage will be uncommon level of sunshine. Its branding now pops up in every single place, together with retail parks, roadside areas, railway stations and even airports. The corporate’s quirky advertising, particularly its completely cooked idea of the vegan sausage roll, has additionally attracted outsized consideration from traders.

FTSE 250 cult inventory

On one degree there’s a stable underlying enterprise case. Greggs has expanded quickly, pushing its outlet rely in the direction of the two,700 mark whereas shuttering websites that didn’t make the grade. Even so, it couldn’t escape the cost-of-living disaster. Gross sales development started to gradual within the autumn of 2024, and that development continued by 2025.

Greggs has been a curious enterprise. For some time it benefitted from buyers having much less to spend, providing them a deal with they may afford. However finally the buyer squeeze grew to become too extreme, even for Greggs. There’s no assure it would profit if the financial system improves. Consumers may merely commerce up. However given the state of the UK right now, we’re a great distance from that.

The opposite oddity was valuation. For a purveyor of cut-price pastries, the high-flying Greggs share worth grew to become costly. The value-to-earnings (P/E) ratio climbed above 22, whereas the dividend yield slipped to a meagre 2%. That’s after I started to fret. It felt just like the shares had outrun the expansion story. My concern has been largely borne out. Gross sales proceed to develop however at a slower tempo, and that alone was sufficient to knock the stuffing out of the inventory.

Right now, the numbers look very completely different. Its P/E has fallen to round 10.9 and the dividend yield has climbed to a extra nourishing 4.2%. I like shopping for out-of-favour shares, if I can bag a decrease entry worth and better earnings. So can Greggs ship?

Gross sales up, income flat

Many traders hoped 2026 could be the 12 months the shares staged a restoration, however to this point that hasn’t occurred. The value is down one other 2% this 12 months, whereas the FTSE 250 has risen 3.7%. Somebody with £10k within the inventory would now have £9,800. Over 12 months, Greggs would have turned £10k into simply £7,500.

On 8 January Greggs warned full-year income could be flat, as shopper confidence stays sudued. New provide chain capability may even put strain on margins. The shares fell virtually 7% on the day. There have been some positives as This fall gross sales rose 7.4% year-on-year, though like-for-like gross sales in company-managed outlets elevated a extra modest 2.9%.

There’s a case for Greggs slowing its growth to concentrate on effectivity and profitability. The nation can solely abdomen so many sausage rolls. At right now’s diminished worth, I feel the shares are value contemplating with a long-term view. However within the quick time period, the outlook is a bit flaky.