Greggs PLC's (LSE:GRG) half-year results on Tuesday should give investors a clearer idea of how much inflation is still being baked into its sales figures.
The sausage-roll king warned in its first quarter update back in May that cost inflation was likely to stick around, with 9-10% expected over the year.
Sales were growing by a strong 17.1% on a like-for-like basis for the first 19 weeks of the year, helped by new deals on hot food and extended opening hours.
Despite this, the board reiterated that it was confident in making further progress despite any challenges concerned with this backdrop.
“Whilst uncertainties continue, the board’s expectations for the full-year outcome are unchanged,” the FTSE 250-listed group said.
Also, since then, while inflation has eased, growth is expected to soften too as we move through the year as comparable periods become tougher than in the first half.
The market is looking for 15% revenue growth over the year, "so we’ll get an idea next week as to whether that looks achievable or not," said Matt Britzman, analyst at Hargreaves Lansdown.
"Things are progressing well, and that’s reflected in the valuation which doesn’t leave much room for error."