A G Barr – strong moves into Adult Soft Drinks highlights ‘cheap’ shares at 687p, TP 750p

Mark Watson-Mitchell - 04.02.2026

Yesterday’s Full Year Trading Update from A.G. Barr (LON:BAG) was really quite positive.

Capitalised at £765m, the multi-beverage business boasts a broad portfolio of market-leading UK brands including IRN-BRU, Rubicon and Boost.

The group has now acquired two other brands operating in the Adult Soft Drinks market – paying £38m for Fentimans, well-known for its soft drinks and mixers, and for £13m it purchased Frobishers Juices, famed for its fruit juices and soft drinks.

The market liked yesterday’s combined pieces of corporate news and a very healthy trading in the group’s shares saw them close nearly 6% higher at 687p.

The Trading Update

For the year to end-January, the group reported a strong financial period, with revenue growing approximately 4% to £437m (£420m) and with an adjusted operating margin increasing to 14.7% (13.6%), contributing to double-digit profit growth.

The company stated that the improvement was driven by benefits from on-going efficiency initiatives and supply chain investment.

The acquisitions will be integrated during FY26/27, with associated efficiencies beginning to come through from H2.

Management Comment

CEO Euan Sutherland stated that:

"We are pleased to report a strong year that highlights delivery of our strategic priorities. 

Our top and bottom line performance for FY25/26 is in line with expectations, and importantly we have laid strong foundations for future growth. 

We enter FY26/27 with good momentum in our core brands and from the introduction of exciting new products. 

In-line with our strategy of enhancing our organic growth with M&A, we are delighted to announce the acquisitions of Fentimans and Frobishers. 

The synergies associated with these acquisitions are expected to drive meaningful accretion over the medium term. 

Underpinning all our activity is our consistent focus on efficiency, margin and growing shareholder returns."

The Equity

There are some 112m shares in issue, with around 56% owned by institutional investors.

The larger holdings include Lindsell Train (9.99%), Fidelity Management & Research (5.04%), Rathbones Investment Management (3.77), Schroder Private Banking (2.57%), The Vanguard Group (2.48%), Heronbridge Investment Management (2.34%), FIL Investment Advisors (2.33%), Royal London Asset Management (2.19%), BlackRock Investment Management (1.67%) and Schroder Investment Management (1.66%).

Broker’s View

Sector analysts Darren Shirley and Clive Black, at Shore Capital Markets, reacted to the latest news by noting that the group’s Management sees healthy upside over the next three years from synergies, the elimination of third-party manufacturing (similar to Boost) and medium-term sales growth in an attractive category.

The brokers consider that strong strategic and financial progress has been delivered in FY26F, with Barr again flexing its balance sheet to further tilt an already attractive brand portfolio further into growth.

Their estimates for the year to end-January are for revenues to have increased to £437m (£420m), with adjusted pre-tax profits improving to £65.6m (£58.5m), lifting earnings to 44.1p (39.4p) and paying a better dividend of 19.6p (16.9p) per share.

For the year to end-January 2027, before adding the latest acquisitions, they see sales of £454m, with £70.8m profits, 47.2p earnings and a 21.0p per share dividend.

The analysts will be adjusting their figures come Tuesday 31^st March, when the group publishes its Final Results.

Analyst Anubhav Malhotra, at Panmure Liberum, considers that the group’s shares remain cheap despite its rock solid balance sheet and growth potential.

He retained his ‘buy’ recommendation and target price of 750p on the maker of Irn-Bru, following full-year 2026 trading coming in in-line with expectations, with revenues up 2.5% on the previous year.

“Key new product development and brand refreshes have landed in January, with more to come this year which should drive an acceleration to the 4-5% target growth rate in full-year 2027.

The group has also announced two acquisitions – Fentimans and Frobishers – in the fast-growing adult soft drinks category, which broaden the product portfolio and offer meaningful cost and revenue synergy opportunities overtime.

The shares have moved sideways in the past year, up 11%, and reigniting the top-line will be a key driver of equity, they remain cheap on the potential of future growth off a rock-solid balance sheet.”

In My View

Still busy with the fizzy,

the IRN BRU maker is now really going soft, but I feel that its shares will harden in reaction.