Associated British Foods PLC (LSE: ABF)

Associated British Foods PLC (LSE: ABF) a constituent of the FTSE 100 index, operates as a diversified conglomerate with a portfolio spanning food production and retail. The company is structured into five key divisions: Grocery, Ingredients, Agriculture, Sugar, and Retail. Its Grocery division specializes in manufacturing a broad range of food products, including hot beverages, sweeteners, vegetable oils, balsamic vinegars, baked goods, cereals, ethnic foods, and meat products. This Report covers the Key Recommendation Rationale, Conclusion, and Recommendation on the stock.

Key Recommendation Rationale – Buy at GBX 1,834.00

• UK Primark Momentum and Market Share Gains: Primark delivered solid progress in the UK despite a difficult apparel backdrop, supported by targeted investment in product, pricing perception and digital engagement. Like-for-like growth and market share gains indicate that the strengthened customer proposition is resonating, particularly in womenswear.
• Growth Platforms Continue to Advance - The Group continues to execute on its expansion strategy, with new store openings contributing meaningfully to sales growth across markets. The launch of the first franchise store in Kuwait highlights the scalability of the Primark model and provides a capital-light route to future international growth.
• Group Confidence Underpinned by Diversification and Long-Term Initiatives - While near-term conditions remain challenging, management’s outlook reflects confidence in the Group’s diversified portfolio and the actions underway to drive improvement, particularly in Europe. Continued investment in medium- and long-term growth initiatives positions ABF to benefit as consumer conditions stabilise.

Valuation Methodology: Price/ Earnings Approach

Share Price Chart  

 ABF Daily Technical Chart, Source - Refinitiv 

Conclusion

For conducting the valuation, the following peers have been considered - Next PLC (LSE: NXT), Marks and Spencer Group PLC (LSE: MKS) and others.

Given its current trading levels, Revenue Growth & Store Expansion, Long-Term Guidance and Shareholder Returns, relative valuation, and associated risks a ‘Buy’ recommendation is given on the stock at the Current Market Price of GBX 1,834.00 as of 12 January 2026 at 08:42 AM GMT.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 12 January 2026. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level which the stock is expected to reach as per the relative valuation method and/or technical analysis taking into consideration both short-term and long-term scenario.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the London Stock Exchange (LSE) and/or REFINITIV. Typically, both sources (LSE and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’

Note 6: Dividend Yield may vary as per the stock price movement.