Morgan Stanley Initiates Coverage on Anheuser Busch Inbev SA (BUD)
Equities researchers at Morgan Stanley started coverage on shares of Anheuser Busch Inbev SA (NYSE:BUD) in a research report issued to clients and investors on Wednesday, StockTargetPrices.com reports. The brokerage set an “overweight” rating on the stock.
The analysts wrote, “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,”
Other equities analysts have also recently issued reports about the stock. HSBC reaffirmed a “buy” rating on shares of Anheuser Busch Inbev SA in a report on Thursday, June 30th. Susquehanna reaffirmed a “buy” rating on shares of Anheuser Busch Inbev SA in a report on Wednesday, June 8th. Kepler Capital Markets raised shares of Anheuser Busch Inbev SA from a “hold” rating to a “buy” rating in a report on Monday, August 22nd. Jefferies Group started coverage on shares of Anheuser Busch Inbev SA in a report on Tuesday, September 13th. They issued a “buy” rating and a $146.00 target price on the stock. Finally, Citigroup Inc. reissued a “buy” rating on shares of Anheuser Busch Inbev SA in a research note on Monday, September 26th. One research analyst has rated the stock with a sell rating, five have given a hold rating, thirteen have assigned a buy rating and one has issued a strong buy rating to the company. The stock presently has a consensus rating of “Buy” and an average price target of $133.42.
Shares of Anheuser Busch Inbev SA (NYSE:BUD) traded up 0.4193% during midday trading on Wednesday, hitting $129.2597. 332,761 shares of the stock were exchanged. The firm has a market cap of $207.82 billion and a PE ratio of 54.6784. Anheuser Busch Inbev SA has a 12-month low of $109.47 and a 12-month high of $136.08. The firm has a 50-day moving average price of $126.93 and a 200 day moving average price of $125.99.
Anheuser Busch Inbev SA (NYSE:BUD) last announced its earnings results on Friday, July 29th. The company reported $1.06 EPS for the quarter, beating analysts’ consensus estimates of $1.00 by $0.06. The business earned $10.81 billion during the quarter, compared to analyst estimates of $10.93 billion. The business’s revenue was down 2.2% compared to the same quarter last year. During the same period in the previous year, the firm earned $1.21 earnings per share. Analysts predict that Anheuser Busch Inbev SA will post $3.70 earnings per share for the current fiscal year.
Several large investors have recently added to or reduced their stakes in BUD. Franklin Resources Inc. raised its stake in Anheuser Busch Inbev SA by 146.4% in the second quarter. Franklin Resources Inc. now owns 5,189,442 shares of the company’s stock valued at $683,345,000 after buying an additional 3,083,352 shares in the last quarter. Lone Pine Capital LLC increased its position in shares of Anheuser Busch Inbev SA by 124.1% in the second quarter. Lone Pine Capital LLC now owns 4,207,607 shares of the company’s stock valued at $554,058,000 after buying an additional 2,329,803 shares during the last quarter. First Eagle Investment Management LLC purchased a new position in shares of Anheuser Busch Inbev SA during the second quarter valued at $207,234,000. Senator Investment Group LP increased its position in shares of Anheuser Busch Inbev SA by 95.8% in the second quarter. Senator Investment Group LP now owns 2,350,000 shares of the company’s stock valued at $309,448,000 after buying an additional 1,150,000 shares during the last quarter. Finally, Renaissance Technologies LLC increased its position in shares of Anheuser Busch Inbev SA by 378.1% in the first quarter. Renaissance Technologies LLC now owns 397,317 shares of the company’s stock valued at $49,530,000 after buying an additional 314,209 shares during the last quarter.
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.
Receive News & Ratings for Anheuser Busch Inbev SA Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Anheuser Busch Inbev SA and related companies with MarketBeat.com's FREE daily email newsletter.