AG Barr – building great brands that people love, Finals next Tuesday, shares 628p, consensus average TP 764p
- Mark Watson-Mitchell
- 1 day ago
- 3 min read
Mark Watson-Mitchell - 26.03.2026
Since early February, when the multi-beverage business A.G. Barr (LON:BAG) announced its Full Year Trading Update, this group’s shares have been up to 715.32p and back down to a recent low of 608p, which was scored last Monday 23rd March.
Now, ahead of the IRN-BRU brand-owning group reporting its Finals to end-January this year, due next Tuesday morning, it could well prove to be opportune to take a position, especially with the shares staging something of a recovery to the current 628p.
The Business
Established 150 years ago in Scotland, this £697m-capitalised group now operates across the UK, and with export markets throughout the world.
Its multi-beverage business has a diverse and differentiated portfolio of 16 brands, including IRN-BRU, Rubicon and Boost.
IRN-BRU, which is the UK's third biggest flavoured carbonates brand, celebrates its 125th anniversary this year.
The Lanarkshire-based company is committed to being a brand owner and builder, with the declared ambition of doubling the business over the medium-term through ‘a flywheel of consistent growth’.
The group has recently 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.
Both acquisitions represent strategic moves by the group to expand its brand portfolio in the adult soft drinks market and thereby to achieve cost synergies.
Early February Trading Update
The group reported a strong financial year to end-January, with revenue growing some 4% to £437m and with its adjusted operating margin increasing to 14.7%, contributing to double-digit profit growth.
The company stated that it was entering this financial year with good momentum, supported by brand innovation and operational investments, with the integration of the new acquisitions expected to yield efficiencies from the second half of FY26/27.
Management Comment
Along with that Update, 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 112.03m shares in issue.
The larger holders include Fidelity Management & Research (5.04%), Lindsell Train (4.99%), Rathbones Investment Management (3.73%), Schroder & Co Bank (Private Banking) (2.57%), The Vanguard Group (2.49%), Heronbridge Investment Management (2.34%), FIL Investment Advisors (UK) (2.31%), Royal London Asset Management (1.99%), Schroder Investment Management (1.63%), and Polar Capital (1.59%).
Broker’s Views
Some eight firms follow the group closely, seven of whom call the shares as a Buy, the other as a Hold.
The analyst consensus average was for a 764p Target Price, with the Lowest for 600p, and the Highest 815p.
At the House Brokers, Shore Capital Markets, its analysts Darren Shirley and Clive Black see a healthy upside over the next three years from synergies, the elimination of third-party manufacturing and medium-term sales growth in an attractive category.
They 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.
The analysts estimate that the year to end-January will have seen revenues increased to £437m (£420m) and adjusted pre-tax profits improving to £65.6m (£58.5m), while generating earnings to 44.1p (39.4p) and paying a better dividend of 19.6p (16.9p) per share.
For the current year to end-January 2027, before adding the latest acquisitions, they were looking for sales of £454m, with £70.8m profits, 47.2p earnings and a 21.0p per share dividend.
My View
The low-calorie carbonates market now accounts for 50% of category sales and is growing faster than higher-calorie options.
The group’s recent moves into the Adult Soft Drinks market (via Fentimans and Frobishers), together with its rebranding of certain of its lines, highlights the group’s promise of growth.
Ahead of next Tuesday’s results, wars permitting, makes the shares at 628p offer some decent upside.
In July last year, they hit 728p and could soon be up there again.
(Profile 31.07.20 @ 444.50p set a Target Price of 525p*)
(Profile 26.03.25 @ 610p set a Target Price of 715p*)
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