Berenberg initiated coverage of Greencore Group with a Buy rating and a 351p price target, citing strong growth prospects from its Bakkavor acquisition. The research firm forecasts a 14% three-year EPS CAGR, with Greencore trading at a forward P/E of 11x and a 7.3% free cash flow yield.

The acquisition is seen as transformative, broadening Greencore’s grocery retail relationships and buying power. It positions the combined entity to lock out competition and drive new business wins in the food-to-go market, a sector benefiting from return-to-office trends and consumer demand for convenience and value options.

Berenberg expects Greencore’s margins to exceed 7% by fiscal 2028, with potential upside from cost synergies. The firm also projects a path to a net-cash position by 2030, which could support further acquisitions or shareholder returns as the company capitalizes on structural tailwinds.