Again in August, I bought roughly half my stake in food-on-the-go retailer Greggs (LSE: GRG) from my Shares and Shares ISA. As I kind, this goes down as certainly one of my higher funding choices. Within the final month, the shares have dropped 10% in worth.

Is it time for me to extend my holding once more or does current momentum recommend I ought to take into account promoting the rest?

What’s gone incorrect?

To an off-the-cuff observer, a double-digit fall in any share price over such a small time frame means that one thing has gone critically incorrect. However I don’t actually assume that’s the case. The FTSE 250 member’s newest set of quarterly numbers — revealed on 1 October — nonetheless seemed fairly tasty to this Idiot.

Complete gross sales rose 10.6% over the three-month interval to twenty-eight September and like-for-like gross sales (in company-managed outlets) had been up 5%. Throw in a bunch of recent retailer openings and price inflation being on the decrease finish of expectations and there’s really rather a lot to love.

However there’s one factor I didn’t like. And it was precisely the factor I used to be apprehensive about once I reached for the ‘sell’ button some time again.

No change

Having delivered some more-than-decent figures, administration declared that it’s expectations on buying and selling for the total 12 months had been unchanged.

Now, this wasn’t dangerous in itself. It’s fairly comforting to know that CEO Roisin Currie and co are assured of their projections. However it’s lower than fascinating when the shares are flirting with document highs and the valuation is trying punchy to say the least. In such a state of affairs, I would like an organization to be blowing the doorways off!

And Greggs simply…wasn’t.

High FTSE 250 inventory

For the avoidance of doubt, that is nonetheless certainly one of my favorite mid-tier UK shares. It sells low-ticket treats that most individuals purchase out of behavior — useful throughout a cost-of-living disaster. Pandemic-aside, the agency additionally generates persistently glorious returns on the cash invested within the enterprise. This tends to compound shareholders’ cash over time.

The issue is that these sights aren’t a secret. Certainly, they assist clarify why the Greggs share price was on a roll for a lot of final 12 months and 2024.

It additionally helps to clarify why the inventory nonetheless trades on a forecast P/E ratio of 21. That’s not as excessive because it as soon as was. However it’s nonetheless fairly punchy for a corporation within the Shopper Cyclicals sector. It’s additionally fairly worrying contemplating simply how risky the price has been within the final 5 years.

Staying affected person

To return to my authentic set of questions, I’m not pondering of promoting my remaining holding within the firm. Making an allowance for the aforementioned sights and the continued funding into its provide chain (redevelopment/extension of distributions centres and a brand new frozen product manufacturing and logistics facility), I feel the long-term outlook stays optimistic.

Then again, I’m additionally not dashing to purchase again my shares simply but. With out a sense that earnings steering could be about to ship analysts scrambling again to their calculators, I’m involved the price would possibly drift for some time (or worse).

If Greggs shares develop into a screaming cut price, I’ll undoubtedly rethink. However I don’t assume we’re there but.