Jefferies downgraded UK bakery chain Greggs to "hold" from "buy" and slashed its price target to 1,610p from 2,500p, citing weight-loss drugs as a structural headwind causing 18 months of declining sales volumes. The move sent shares down over 3% on Monday, reflecting growing concerns about the impact of GLP-1 receptor agonists on traditional food retailers.

UK users of drugs like Mounjaro and Wegovy have reached 2.5 million, representing a fivefold year-over-year rise and nearly 70% growth in four months. These users reduce daily calorie intake by 25-30%, primarily cutting back on savoury, salty, high-fat foods that form Greggs' core offering, with current usage approaching 4 million users.

The brokerage cut medium-term like-for-like growth forecasts from 4.5% to 2.5% and models EBIT margins contracting. Greggs CEO Roisin Currie confirmed in January 2026 that weight-loss drugs were impacting the business, with FY26 pre-tax profit forecast flat at £171 million despite price increases unable to offset volume declines.

Quick Fact: UK GLP-1 users reached 2.5 million by July 2025.