Greggs (LSE:GRG) reputation as a piping hot growth stock has collapsed over the last year, sending its share price lower. At £16.50 per share, the FTSE 250 company has dropped 21% in value, having fallen further at the start of 2026.
However, City forecasts for Greggs shares suggest the battered baker could be on the verge of a spectacular recovery. One especially bullish analyst reckons it’ll rocket to £25 a share over the next 12 months.
That represents a 51% increase from current price levels. The question is, can the business really stage a stunning rebound? Or are current forecasts just sugar-coated thinking?
Strong price forecasts
It’s worth noting that this spectacular estimate is just one of 14 currently doing the rounds. What’s more, there are some sizeable differences between where brokers see Greggs shares heading during the next year.
Indeed, one pessimistic broker thinks they’ll hit new multi-year lows of £16.15 per share. That’s down 20% from where they are today.
Yet on the whole, forecasters are betting that Greggs’ share price will stage some sort of healthy rebound. The average 12-month price target is £18.53, suggesting a 12% uplift from today.
With expected dividends for the period thrown in, it suggests shareholders like me could enjoy a total return of roughly 16%. Given how cheap the company’s shares now are, there could be a compelling case for investors to consider piling in.
Today, Greggs trades on a forward price-to-earnings (P/E) ratio of 13.2 times. That’s significantly below the long-term average of around 23 times.
Yet any upturn will require a sharp improvement in trading and by extension market confidence. And realistically, how likely is that in the current climate?
What could go wrong?
It’s possible, although weak consumer spending could remain a big problem for the food retailer. That’s not the only threat to a possible comeback either: competition is fierce and growing, and fast food rivals also expand.
Then there’s the problem of changing consumer tastes as people seek out healthier ways to eat. Greggs CEO Roisin Currie has also said there is “no doubt” appetite-suppressing jabs like Ozempic are impacting sales.
But there’s also scope for significant optimism, in my view. Many of the products it serves, from cups of tea to doughnuts, sandwiches, and pasties, are British staples that aren’t going away any time soon. And Greggs’ is introducing new ranges to capitalise on the move to healthier eating. Given its long-running success with menu refreshments, I’m expecting big things from Greggs here.
The final word on Greggs shares
But I’m most excited by Greggs’ ongoing growth strategy and its potentially transformative effect on earnings. The firm has considerable scope to gain share in the delivery market. It’s expanding evening trading across its stores too, the fastest-growing part of the day for its operations.
Finally, the company continues expanding its store estate in a phased and strategic way. Plans to raise shop numbers to 3,000 include focusing on more lucrative high-footfall areas away from the high street. It’s also opening more cost-effective franchise stores to its portfolio.
As I’ve said, Greggs continues to face significant risks right now. But I also believe it has the potential to bounce back strongly in 2026, making it a top recovery stock to consider.
