FTSE 250 round-up: Greggs, Ithaca Energy, Paragon Banking
Analysts are expecting a big increase in mid-cap earnings this year, but some strong results have still surprised doubters. Graeme Evans runs through the risers and fallers.
29th July 2026 15:33
by Graeme Evans from interactive investor
People walk past a Greggs in London. Photo: John Keeble/Getty Images.
A stunning session for Greggs (LSE:GRG) shareholders alongside big gains by Ithaca Energy Ordinary Share (LSE:ITH) and Paragon Banking Group (LSE:PAG) today kept the FTSE 250 index near its highest level in almost five years.
The mid-cap benchmark last night closed above the 24,000 threshold for the first time since September 2021, having surged by 14% from its low point of the year in late March.
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Takeover action involving major companies including Rotork (LSE:ROR), MITIE Group (LSE:MTO) and easyJet (LSE:EZJ) has boosted recent performance, as well as hopes that the impact on earnings from the Middle East war will not be as severe as first thought.
Deutsche Bank said last week that it still expects a 9% year-on-year increase in mid-cap earnings, fuelled by stocks in the financials, basic materials and staples sectors.
The upbeat tone of Greggs’ interim results published today clearly wrong-footed the City, as well as the large number of investment firms and hedge funds with short positions.
S&P Global Market Intelligence said yesterday about 15.5% of shares were out on loan, making Greggs the UK’s fourth most-shorted stock behind Vistry Group (LSE:VTY), Ibstock (LSE:IBST) and Wizz Air Holdings (LSE:WIZZ).
Today’s surge of 255p to 1,945p took Greggs shares to their highest level since June 2025, after pre-tax profits rose by a slightly better-than-expected 19.7% to £76 million and chief executive Roisin Currie signalled plans for further expansion.
The stock remains significantly below the 3,000p achieved in autumn 2024, having been squeezed by a combination of inflationary and consumer spending pressures as well as market speculation of “peak Greggs” following a long period of expansion.
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The bakery chain said its outperformance had continued in the face of challenging conditions as total revenues rose 7.2% to £1.1 billion, with company-managed shop like-for-like sales up 2.1%.
Currie reiterated expectations for the full year as she signalled the opportunity for 3,500 UK stores in the long term, which compares with an existing estate of 2,773 sites.
She added: “We are making great progress in building the supply chain infrastructure that will support the significant growth opportunities that lie ahead.”
Elsewhere on the FTSE 250 risers board, Ithaca Energy and Harbour Energy (LSE:HBR) rallied after the price of Brent crude returned towards $90 a barrel.
They were joined by Paragon Banking Group, which rose 38p to 861p as the provider of buy-to-let mortgages and business loans delivered a reassuring third-quarter trading update.
It said lending volumes, margins, costs and capital continue to track in line with expectations, while underlying credit quality remains strong.
Shore Capital, which has a price target of 1,080p, said current City multiples undervalued Paragon’s attractive return on tangible equity, earnings growth and capital return profile.
It said: “We continue to see materially better value than larger domestic bank alternatives, such as Lloyds Banking Group (LSE:LLOY) and NatWest Group (LSE:NWG), which trade on higher multiples despite similar return profiles.”
At the other end of the FTSE 250, Breedon Group (LSE:BREE) shares fell 9.5p to 316.1p after the construction materials supplier forecast that demand in the UK will decline for a fifth consecutive year.
This has been offset by momentum in Ireland and the United States, where organic growth has been supported by contributions from recent bolt-on acquisitions.
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Chief executive Rob Wood said: “We are building an increasingly diversified business in the structurally attractive Irish and US markets, where we see supportive conditions for both volumes and pricing, while still retaining significant upside in GB once volumes recover.”
Today’s interim results were in line with expectations as revenue increased by 5% to £858 million and underlying earnings lifted 1% on a like-for-like basis to £115.5 million.
The dividend for payment on 6 November increased by 5% to 5p a share, which Breedon said reflected its confidence in resilient cash generation and long-term prospects.
Broker Peel Hunt has a price target of 415p, adding that a current valuation of 10 times forecast 2027 earnings was good value given “where we are in the cycle”.
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