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Greggs plc : The GBp 450 support area is tested

01/11/2013 | 05:34am
Opinion : Bullish above GBp 449
Target price : GBp 466
Stop loss: GBp 440.5
Food Processing

In the past few sessions, Greggs plc shares have suffered from a sharp fall and are now coming back on significant level support.

From a fundamental viewpoint, the company seems undervalued relatively to its peers with a EV/Sales of 0.6.
However, analysts have revised slightly downward their earnings forecasts. With an EPS estimated at GBp 40.1 for this year and GBp 42.78 for the next year, Greggs is currently paid 11.29 and 10.58 times the results.

The security follows a downward trend in the short term, under the GBp 466 resistance area. However, the selling pressure could run out of steam soon. Indeed, whereas the stock shows an oversold condition, the GBp 449 support area currently tested might stop the bearish trend in the short term.

The trading strategy can benefit from the proximity of the strong support currently tested in order to buy Greggs in a good timing. Investors might placed a stop loss order at GBp 435.5 in order to avoid important losses.

Greggs plc : Greggs plc : The GBp 450 support area is tested

© 2013

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Financial Ratios

Size 2015e 2016e
Capitalization 1 034 M GBP -
Entreprise Value (EV) 1 038 M GBP 1 040 M GBP
Valuation 2015e 2016e
PER (Price / EPS) 21,0x 19,3x
Capitalization / Revenue 1,25x 1,20x
EV / Revenue 1,26x 1,21x
EV / EBITDA 10,3x 9,73x
Yield (DPS / Price) 2,22% 2,33%
Price to book (Price / BVPS) 3,90x 3,51x
Profitability 2015e 2016e
Operating Margin (EBIT / Sales) 7,46% 7,66%
operating Leverage (Delta EBIT / Delta Sales) 2,25x 1,70x
Net Margin (Net Profit / Revenue) 5,70% 5,94%
ROA (Net Profit / Asset) - -
ROE (Net Profit / Equities) 104% 99,4%
Rate of Dividend 46,6% 45,0%
Balance Sheet Analysis 2015e 2016e
CAPEX / Sales   6,75% 6,10%
Cash Flow / Sales (Taux d'autofinancement) - -
Capital Intensity (Assets / Sales) - -
Financial Leverage (Net Debt / EBITDA) 0,04x 0,06x
Income Statement Evolution
More Financials
EPS Revisions
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