Professional
Added to YB: 2024-04-02
Pitch date: 2024-03-26
ABEV [bullish]
Ambev S.A.
+48.99%
current return
Author Info
No bio for this author
Company Info
Ambev S.A., through its subsidiaries, engages in the production, distribution, and sale of beer, draft beer, soft drinks, malt and food, and other beverages in Brazil, Central America and Caribbean, Latin America South, and Canada.
Market Cap
BRL 255.3B
Pitch Price
BRL 10.85
Price Target
3.60 (-78%)
Dividend
8.92%
EV/EBITDA
8.37
P/E
16.54
EV/Sales
2.71
Sector
Beverages
Category
value
Ambev S.A. Begins Margin Rebuild as Commodity Cost Pressure Eases
ABEV: Ambev holds brewing monopolies in large LatAm markets (81% share in Argentina, 68% in Brazil). Wide moat from regional scale cost advantages & strong brands. Near-term margin pressure from cost inflation, but premiumization & cost relief are LT margin drivers. $3.60 fair value estimate on 5% organic growth & 26.5% steady-state EBIT margin. Key risks: LatAm macro volatility, excise taxes, interest on equity tax changes. Exemplary stewardship & strong FCF, but limited capital return flexibility.
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