The Greggs (LSE:GRG) share price was already in trouble before the Iran war sparked investor panic. After a great run when FTSE250 the bakery chain could do no wrong, its sales, profits and stock performance began to decline in overdue 2024.

The Middle East is concerned about tensions to make a bad situation worse by increasing inflation and leaving consumers feeling even poorer. However, investors who expected Greggs shares to fall may be in for a surprise. They are up 5.8% over the past week. Only six FTSE 250 companies performed better. What’s going on?

FTSE 250 mixed bag

While investors obsess over geopolitical events, news about individual companies can still influence stock prices. Last Tuesday (March 3), Greggs reported that total sales were up 6.8% to £2.2 billion in the year ended December 27, while like-for-like sales in company-operated stores were up 2.4%.

Chief Executive Roisin Currie welcomed: “resistant” results, indicating growing market share and further strategic progress. This may explain why the stock has held steady. However, these were not outstanding results.

Underlying pre-tax profit fell 9.4% to £172m, driven by volume pressures and rising fixed costs related to production, logistics and technology capabilities.

Greggs was also quite bleak about the prospects. He expects market conditions to do so “stay challenged” this year. I don’t think anyone would question that these days.

Greggs insists its forceful value proposition should support sales, but the recent financial year looked sluggish, even ahead of Iran. In these hard times, even a cheeky trip to Greggs is starting to feel like a luxury for many.

The group has brilliantly reflected public sentiment over the years, but Dan Coatsworth, head of markets at AJ Bell, has drawn attention to “a nagging feeling that his proposal is becoming obsolete”even though the company is constantly refreshing its menu.

Growth, value and income

I understand his point of view. I’m not a natural Greggs customer, but over the years I’ve popped in for the odd sausage roll or steak bake. Lately, though, I don’t really like it. Greggs acknowledges that food preferences are changing. Consumers are increasingly looking for more protein, more fiber and smaller portions. The growing popularity of weight loss drugs may also have an impact.

When I last looked at Greggs shares on March 1, the price-to-earnings ratio looked really tempting at 10.5. This is less than half the level seen during the boom years. Nine days later it had risen to around 13.85.

This change likely reflects weaker earnings as well as the recent share price rebound. Today it’s decent value, but not dirt affordable. The terminal dividend yield has dropped slightly to around 4.2%, although this still looks quite attractive for income seekers.

Still, I’m not too excited about these results and wonder if Greggs’ moment has passed. Die-hard fans may want to consider buying shares of this company today, but I see there are plenty of them out there FTSE100 and FTSE 250 shares, which look more tempting given the current volatility.