Anheuser Busch Inbev SA (BUD) Receives New Coverage from Analysts at Morgan Stanley
“We believe ABInBev offers the best combination of organic sales growth and self help across Global FMCG, which should command a valuation premium,” analyst Olivier Nicolai wrote in a note.Nicolai’s bullish thesis is based on “1) rapid top-line growth and a well-diversified group post the deal; 2) cost and revenue synergies will support group EBIT; 3) the shares warrant a 15 percent premium to global FCMG, given the stronger earnings growth profile.”Post disposal of the low-growth assets from SAB (United States, China, Europe), the analyst expects Anheuser-Busch to grow organic sales by close to 6 percent a year and EBITDA by about 10 percent a year in FY17-20, putting the company’s profitability and cash generation higher than peers.In addition, the analyst said very high market share with strong pricing power across most of its markets provides more visibility on earnings.Related Link: This Penalty’s For You: Anheuser-Busch Ordered To Pay Up For Violating Whistleblower ProtectionsMeanwhile, Nicolai projects cost synergies of $2.5 billion. Anheuser-Busch has guided to at least $1.4 billion over four years from completion plus the $0.5 billion remaining cost savings previously announced by SABMiller. Further, the analyst expects the company to generate an additional $500 million in EBIT from revenue synergies by 2020 and $1 billion by 2022, six years after completion of the deal.In fact, Nicolai pointed out that revenue synergies would be the key medium-term upside driver as ABI rolls out its international brands Corona, Stella Artois and Budweiser into SAB markets — Colombia, Peru and South Africa, as well as the rest of Africa.”In addition to a review of pricing strategy, we expect positive mix, as we saw in Brazil and China where ABI was successful in its strategy around Bud and Stella,,” the firm’s analyst commented.
Several other equities analysts have also weighed in on BUD. Susquehanna reiterated a buy rating on shares of Anheuser Busch Inbev SA in a report on Wednesday, June 8th. HSBC reiterated a buy rating on shares of Anheuser Busch Inbev SA in a report on Thursday, June 30th. Credit Agricole SA reiterated an outperform rating and issued a $142.00 target price on shares of Anheuser Busch Inbev SA in a report on Friday, July 1st. Royal Bank Of Canada lowered shares of Anheuser Busch Inbev SA from a sector perform rating to an underperform rating and boosted their target price for the company from $102.00 to $106.00 in a report on Wednesday, July 6th. Finally, Vetr lowered shares of Anheuser Busch Inbev SA from a buy rating to a sell rating and set a $120.10 target price on the stock. in a report on Wednesday, July 6th. One analyst has rated the stock with a sell rating, five have issued a hold rating, thirteen have assigned a buy rating and one has assigned a strong buy rating to the company. The company has a consensus rating of Buy and an average target price of $133.42.
Shares of Anheuser Busch Inbev SA (NYSE:BUD) traded down 0.80% during midday trading on Wednesday, reaching $128.22. 482,535 shares of the company’s stock traded hands. The stock has a market capitalization of $206.14 billion and a P/E ratio of 54.24. Anheuser Busch Inbev SA has a 1-year low of $109.47 and a 1-year high of $136.08. The firm’s 50-day moving average price is $127.03 and its 200 day moving average price is $126.01.
Anheuser Busch Inbev SA (NYSE:BUD) last posted its earnings results on Friday, July 29th. The company reported $1.06 earnings per share for the quarter, beating the consensus estimate of $1.00 by $0.06. The firm earned $10.81 billion during the quarter, compared to analyst estimates of $10.93 billion. The business’s revenue for the quarter was down 2.2% compared to the same quarter last year. During the same quarter in the previous year, the firm earned $1.21 earnings per share. On average, equities analysts predict that Anheuser Busch Inbev SA will post $3.70 earnings per share for the current fiscal year.
A number of hedge funds have recently modified their holdings of BUD. Winslow Evans & Crocker Inc. boosted its stake in shares of Anheuser Busch Inbev SA by 0.3% in the second quarter. Winslow Evans & Crocker Inc. now owns 782 shares of the company’s stock worth $103,000 after buying an additional 2 shares in the last quarter. National Asset Management Inc. boosted its stake in Anheuser Busch Inbev SA by 0.3% in the second quarter. National Asset Management Inc. now owns 2,466 shares of the company’s stock valued at $325,000 after buying an additional 8 shares during the period. 10 15 Associates Inc. boosted its stake in Anheuser Busch Inbev SA by 1.0% in the second quarter. 10 15 Associates Inc. now owns 2,056 shares of the company’s stock valued at $271,000 after buying an additional 20 shares during the period. Rathbone Brothers plc boosted its stake in Anheuser Busch Inbev SA by 1.2% in the second quarter. Rathbone Brothers plc now owns 1,802 shares of the company’s stock valued at $237,000 after buying an additional 22 shares during the period. Finally, Independent Portfolio Consultants Inc. boosted its stake in Anheuser Busch Inbev SA by 2.1% in the second quarter. Independent Portfolio Consultants Inc. now owns 2,485 shares of the company’s stock valued at $327,000 after buying an additional 50 shares during the period.
Anheuser Busch Inbev SA Company Profile
Anheuser-Busch Inbev SA (AB InBev) is a global brewer. The Company has a portfolio of over 200 beer brands. The Company operates through seven segments: North America, Mexico, Latin America North, Latin America South, Europe, Asia Pacific, and Global Export and Holding Companies. The Company’s brand portfolio includes global brands, such as Budweiser, Corona and Stella Artois; international brands, including Beck’s, Leffe and Hoegaarden, and local champions, such as Bud Light, Skol, Brahma, Antarctica, Quilmes, Victoria, Modelo Especial, Michelob Ultra, Harbin, Sedrin, Klinskoye, Sibirskaya Korona, Chernigivske, Cass and Jupiler.
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