Morningstar - Ambev SA (ABEV3) Brazil Weak Again in Ambevs 1Q, but Premiumisation Is Alive and Well; Shares Fairly Valued

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Morningstar

Philip Gorham

Brazil Weak Again in Ambev's 1Q, but Premiumisation Is Alive and Well; Shares Fairly Valued

Ambev missed our first-quarter expectations on volumes in Brazil, but we take encouragement from the company's margin delivery and from evidence that premiumisation is thriving in Brazil. We reiterate our BRL 21 fair value estimate and wide moat rating, and after a strong rally last year, the market valuation appears fair.
First-quarter organic growth of 6% is in line with our medium-term forecasts, but was held back by weak volumes (down 6%). We had anticipated a volume decline in Brazil becaus...

09/05/2018 12 EN

Underlying

Ambev SA

Ambev is a beverage manufacturing group based in Brazil. Co. produces and sells beer, draft beer, soft drinks, other non-alcoholic beverages, malt and food in general, by participating either directly or indirectly in other Brazilian-domiciled companies and elsewhere in the Americas. Co. has operations in 18 countries: Brazil, Canada, Argentina, Bolivia, Chile, Paraguay, Uruguay, Guatemala, Dominican Republic, Ecuador, Peru, El Salvador, Honduras, Nicaragua, Saint Vincent, Dominica, Cuba and Antigua. Co. conducts its operations through three business segments: Latin America North, Latin America South and Canada.

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BRABEVACNOR1 BM&F Bovespa - Securities, Commodities and Futures Exchange Brazil

Provider

Morningstar

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.

Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.

We have operations in 27 countries.

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Analysts

Philip Gorham

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Brazil Weak Again in Ambev's 1Q, but Premiumisation Is Alive and Well; Shares Fairly Valued

Ambev S.A.: 1 director

Monthly LMI Update Independent Investment Research

AMBEV ON reduces its risk exposure and slightly improves to Neutral

Business as Usual for No-Moat Lonza; Specialty Ingredients Carve-Out on Track for 2020

Astra Posts Solid 2Q, Driven by Strong Cancer Drug Sales and Moving Away From One-Time Divestments

Astra Posts Solid 2Q, Driven by Strong Cancer Drug Sales and Moving Away From One-Time Divestments

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