BF.B - Embedded Expectations Analysis - 2020 06 05
Brown-Forman Corporation (BF.B:USA) currently trades at historical highs relative to UAFRS-based (Uniform) earnings, with a 40.7x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may be concerned about their pricing, Global Travel Retail business, and volume growthSpecifically, management may lack confidence in their ability to evaluate geographic and portfolio performance, improve sales growth rates back towards historical averages, and sustain volume growth. Furthermore, they may have concerns about their exposure to the UK market and the sustainability of their momentum and contribution from China, and they may lack confidence in their ability to reduce promotional spending and improve their pricing. Moreover, they may lack confidence in their ability to sustain Tequila net sales growth, drive higher gross margins in their single malt scotch business, and maintain Woodford Reserve's performance in the Global Travel Retail business
Brown-Forman primarily manufactures, bottles, imports, exports, markets, and sells a range of alcoholic beverage brands. Co.'s principal brands include, among other, Jack Daniel's Tennessee Whiskey; Jack Daniel's Tennessee Honey; Jack Daniel's RTDs; Gentleman Jack Rare Tennessee Whiskey; Jack Daniel's Tennessee Fire; Jack Daniel's Single Barrel Collection; Jack Daniel's Winter Jack; Jack Daniel's Sinatra Select; Jack Daniel's No. 27 Gold Tennessee Whiskey; Jack Daniel's Tennessee Rye; Korbel California Champagnes; Korbel California Brandy; Woodford Reserve Kentucky Bourbon; Woodford Reserve Double Oaked; Woodford Reserve Kentucky Rye Whiskey; Finlandia Vodkas; and Slane Irish Whiskey.
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