Associated British Foods plc (ABF.L) Stock Analysis

Associated British Foods is a diversified FTSE 100 group with approximately £19.5bn of annual revenue across Primark Retail, Grocery, Ingredients, Sugar and Agriculture. Primark contributes about 48.8% of FY2025 revenue, or £9.5bn, while FoodCo supplies defensive branded food, specialty ingredients and agricultural cash flows. **The central catalyst is the targeted December 2027 demerger**, which should create a pure-play fast-fashion retailer and a separate food and ingredients company, allowing each to receive more appropriate peer valuations. FY2026 revenue was broadly in line at approximately £19.5bn, but adjusted operating profit declined 18% in H1 to £691m and Sugar is expected to lose £70m–£170m in FY2027. Primark nevertheless held an approximately 10.0% margin, US Q4 sales grew 11%, and Ingredients Q4 sales rose 10%. At 1,810 GBp (£18.10), ABF trades at 14.3x trailing P/E versus a five-year average of 16.5x, with a 3.02%–3.22% dividend yield and 1.0x–1.2x leverage. Near-term catalysts are home delivery, US expansion, Hovis synergies, Sugar restructuring and demerger filings.