reports
- Dave Nicoski
- Ross LaDuke
Vermilion Int'l Compass: Global Equity Strategy
Market internals sending mixed signals • Mixed market internals; Expect continued volatility and consolidation. Though support levels on the MSCI ACWI and S&P 500 have held - namely the 200-day moving averages and the lows from 2/9/18 - various market internals have begun to show neutral or negative signals... see below and page 2. • Europe at support; Hong Kong and Norway outperforming. The STOXX Europe 600 Index has managed to stay just at or above the important 365 support level that we...
RI PERNOD RICARD SA
RCO REMY COINTREAU SA
MGPI MGP INGREDIENTS INC.
BF.B BROWN-FORMAN CORPORATION CLASS B
SWA SCHLOSS WACHENHEIM AG
2502 ASAHI GROUP HOLDINGS LTD.
4922 KOSE CORPORATION
CI:Z HOLDINGS CO. LTD.
AEFES ANADOLU EFES BIRACILIK VE MALT SANAYII A.S.
RADICO RADICO KHAITAN LTD.
UBL UNITED BREWERIES
4927 POLA ORBIS HOLDINGS INC.
8283 PALTAC CORPORATION
RBREW ROYAL UNIBREW A/S
TWE TREASURY WINE ESTATES LIMITED
TDY LT GROUP
SAM BOSTON BEER COMPANY INC. CLASS A
0168 TSINGTAO BREWERY CO. LTD. CLASS H
ABEV3 AMBEV SA
6630 YA-MAN LTD.
- Philip Gorham
- CFA
- FRM
Ambev Closes a Subpar Year in Style as Brazil Bounces Back
Ambev reported a strong end to the year, beating our earnings forecast thanks to a better-than-expected rebound in Brazil. This reaffirms our investment thesis that while consumer behaviour in Latin America can be volatile, Ambev's wide economic moat--built through distribution infrastructure and brand equity--should allow it to ride out the periodic storms better than most of its peers. We are raising our fair value estimate to BRL 21 from BRL 19 to account for this earnings beat and the impact...
- Philip Gorham
- CFA
- FRM
Market Throws Baby Out with Bathwater; No Change to Ambev or AB InBev'...
We think it is likely that the market is throwing the baby out with the bath water after selling off Ambev shares, which fell 6% last week following the latest political scandal in Brazil, and we are not making any changes to our near-term assumptions. We think Ambev’s wide economic moat in a fairly stable category should make the underlying business more stable than most throughout the turbulence, and we are retaining our BRL 19 fair value estimate for the time being. The drop in the value of...
- Philip Gorham
- CFA
- FRM
Brazil Returns to Growth, but There May be Further Roadbumps Ahead; Am...
Brazil swung back into positive territory in the first quarter, in an earnings report that should go a long way to soothing investors’ concerns about Ambev’s largest market. The earnings report showed that the company’s wide economic moat and strong business model remains intact, and execution apparently improved during the quarter. We are reiterating our BRL 19 and $6 fair value estimates for the local shares and ADRs, respectively. After a positive market reaction to the earnings report,...
- Philip Gorham
- CFA
- FRM
Ambev operates in some turbulent markets, but its moat positions it we...
For the third consecutive quarter, Ambev suffered severe weakness in Brazil that caused consolidated earnings to undershoot our expectations. We are likely to trim our 2017 revenue growth assumption by a percentage point or so, but this should not materially affect our BRL 19 fair value estimate. We think the Brazilian beer industry has long-term growth and margin drivers and the current weakness is creating a fairly attractive opportunity for patient investors. Our wide economic moat rating rem...
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