Redburn-Atlantic downgraded Greggs (LON: GRG) from Buy to Neutral in a note this week, warning that the sharp decline in the bakery chain’s share price “does not connote an opportunity.”
The broker cut its price target on the stock to 1,651p from 2,440p, citing a weaker near-term outlook.
“The retreat in the Greggs share price reflects a weaker, less certain outlook,” Redburn-Atlantic said.
They noted that LFL sales momentum has faded, evening and delivery channels dilute margin and a sizeable supply-chain build-out is deferring free cash flow (FCF) inflection.
The analyst lowered earnings per share estimates by 7% for 2026 and 10% for 2027, forecasting a 2025–28 EPS compound annual growth rate of just 4%, with most of that growth coming in 2028.
“Our EPS estimates are cut… which leaves us 3% below consensus,” the note added.
Greggs' shares have fallen nearly 40% since the start of the year and are down more than 10% in the past month alone.
The stock was last trading at 1,700p, slightly above Redburn-Atlantic’s revised target price.
The downgrade highlights concerns that, despite the recent selloff, the current valuation does not offer a compelling entry point. In September 2024, the Greggs share price rallied to over 3,100p a share.
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