Greggs shares climb amid strong Q3 numbers
In its third quarter update, the high street baker managed to pull another trick out of its hat and show that its vegan push is working. Shares rose as much as 10% as the company delivered a strong set of numbers.
(Video Transcript)
Greggs shares rise
There's been a good, positive market reaction today on Greggs PLC shares rising after a third quarter (Q3) trading update which showed that the company wasn't seeing any material increases in costs.
And at the same time, it said total sales increased by a margin of 14.6%, with like-for-like sales up 9.7%.
Greggs continues to add shops and take away some of those shops that don't work and it's continuing to respond to the new way that people are working, with 90 net new shops opened year-to-date.
The full-year (FY) outcome is expected to be in line with guidance, but the fact that they've had no change in cost inflation outlook for the year was another reason I think to buy this stock.
Greggs chart
Look at where we are in terms of the big moves that we've seen for Greggs. I just want to look back on the left hand side of this chart where back in December last year we were all way up at £34.42 - here we are now at £18.90, and people clearly think this is a reason to buy the stock.
And we've had this downward facing wedge pattern which generally results on the upside. Now, this is called a bullish wedge, but certainly had a really strong reaction to the numbers out this morning. We are ncurrently trading up over 9%, up for Greggs.
The company is on a a real push to try and get more people back into the shops. And anecdotally, if you go to a Gregg's now the chances are if you go at peak times you're going to have to queue outside the shop. They're only small shops, but the point is that Greggs is benefiting from a return to work for a lot of people and they're turning over an awful lot more food.
And the thing is they're also adding to pricing with sausage rolls going up another 5% recently. That doesn't make much of an impact on people's pockets, especially when you're hungry at lunchtime, but it's certainly benefiting with this rise in Greggs shares today.
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