Canaccord downgrades Greggs from 'buy' to 'hold'

6th Aug 2015 14:19

(ShareCast News) - Canaccord Genuity downgraded its rating for Greggs from 'buy' to 'hold' following its interim result last week.It retained a target price for the stock of 1350p, but reduced its rating as the current price was within 10% of its target.Analysts upgraded their earnings forecasts for the bakery chain by 3.5% for the 2015 year, off what they said were "excellent interims.""Greggs' share price has more than tripled in the last 12 months, as the recovery story has gained traction; the long-term story remains good but investors now need to pick their entry points with a bit more care," Canaccord said in a note.Long term there is plenty to do, Greggs said, but a five-year systems overhaul and increased focus on logistic capacity as well as menu initiatives showed serious intent.The living wage would not be an issue as Greggs already paid 9% above the national minimum wage, analysts said."We expect the share price momentum to pause as the market waits to see if Greggs can trade well versus tougher comparatives," Canaccord said.