As a shareholder, I was pleased to see Greggs‘ (LSE:GRG) shares surge following a profit upgrade this week. The stronger trading was a welcome relief, particularly after a few years of declines.

But as the price soared, I pondered the appropriate course of action. Had I missed my chance to buy more, or could this rally have real legs on it?

The stock price surged in early trading on 30 September but corrected slightly the following day. They’re now up about 10% over the week.

It’s the sort of move that can make holding feel strangely uncomfortable. Buying more risks chasing the excitement but doing nothing risks watching the price climb without me.

There’s also a third option: take some profits. But first, what’s actually changed?

A better quarter, not a blank cheque

Greggs’ latest update covers the 13 weeks to 26 September, giving shareholders some concrete growth figures:

• Total sales rose 7.7% from the same quarter last year.
• Sales at company-managed shops open in both periods rose 3.4%.
• Management now expects a “modestly improved” outcome for 2026.

The shop sales figure matters to me because it strips out the boost from opening new sites. It suggests existing outlets are selling more, not simply that there’s more places to sell from. New products and more settled weather helped trading, according to the company.

I’m encouraged, but one quarter doesn’t settle the long-term argument.

Greggs still expects around 100-110 net new shops this year, and those openings need to earn their keep. If growth remains steady, my reason for holding becomes stronger. That doesn’t automatically mean buying at any price.

Nor am I itching to sell because the shares have risen. I’d look harder at taking profits if Greggs had grown too large in my portfolio, or if its price assumed much faster growth than I think the business can deliver. 

Neither decision should come down to one exciting trading session.

The costs behind the excitement

In my opinion, the word ‘modestly’ is doing a lot of heavy lifting in that profit upgrade. It doesn’t exactly flood me with confidence for 2027.

My main concern? The new Derby and Kettering distribution centres are likely to cost a lot before they deliver any profits. On top of that, management expects greater inflationary pressure next year.

Then there’s the proposed manufacturing overhaul. Four sites could close, and around 740 roles could become redundant over two and a half years. Greggs estimates around £60m in cash costs and expects annual savings of about £20m, realised across 2028 and 2029. And those savings are just a forecast, not money in the bank.

So basically, the question I’m left asking myself is, does the share price leave enough room if profits take longer to arrive, or if consumer spending tightens even further?

My decision

All things considered, I’m not leaning either way – Greggs’ shares are a Hold for me. Yes, the improvement in sales gives me some optimism, but the jump doesn’t persuade me to add immediately. Nor is it sufficient to warrant taking profits.

Looking ahead, I’ll monitor existing shop growth and whether new facilities eventually deliver enough benefit to outweigh their costs.

For investors looking for something a bit more exciting, there’s one FTSE 100 growth stock that really stands out right now…

What growth stock do we like better than Greggs Plc right now?

One of our Share Advisor analysts has just released a brand new stock report that we think is a must-read for any investor looking to try and generate potential growth.

And the best bit is that you can see if for yourself, right now, absolutely free of charge!

No jargon. No hard sell. Just a clear look at a growth share idea we think is worth your time.

Mark Hartley owns shares in Greggs.