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Prosperity Bancshares Inc. Message Board

  • gwynnj gwynnj Jan 17, 1998 10:30 PM Flag

    PB: Back to basics

    The following background information is provided by a request. My apologies if it is old news to some.

    -Personally, I resumed long positions in PB, on 1/12/98. Its up some 9% since. I am betting it will continue.

    -PanAmerican Beverages is a major beverage bottler/distributer in several Latin American markets
    (Brazil, Mexico, Columbia, Venezuala, Costa Rica, and Nicaragua, in approximate order by
    revenue, but I won't swear). So it has good diversification against downturns in any one country
    (which we are currently experiencing in Brazil, for example).

    -Capitalization: ~$3 billion

    -1996 revenues: ~$2 billion (before they acquired Venezuala and Nicaragua)

    -Primary products are Coca Cola's, though beer and some regional favorites are produced in
    several countries. Good PB holders should always remember never to drink Pepsi.

    -PB is one of Coke's "anchor" and "super-regional" bottlers. Coke increasingly relies on and
    supports these very strong local bottlers to expand distribution in developing markets. Coke owns a
    significant share of PB and frequently is reported to be looking to get more (sorry, can't remember
    their exact stake, around 25%).

    -PB is known for its professional management (some say "American-style", though not too loudly in
    certain parts of Latin America) and its adherance to (U.S.) generally accepted accounting principles
    (it has had big six auditing for as long as I have followed it). It is listed on the NYSE and not as an
    ADR. This is one company that is NOT using some arcane impenetrable third world accounting

    -Stock price is volatile, but hey...isn't that an opportunity.

    -Trading volumes tend to be low, considering its revenues and size (hey...another opportunity).

    -Though it is 25% off its 1997 high, it ended the year approximately 40% above 1996's close.

    -Earnings estimates have been consistently good, meeting/exceeding analysts expectations.

    -It is highly regarded by many analysts, some of whom have predicted a mid 1998 stock price
    around 50+% above today's. Several brokerage houses have initiated coverage on it within the last
    six months.

    -PB is the top ranked company in Yahoo's Soft Beverages Industry category, out of 17, beating
    out Coke, Pepsi, and several other major bottlers.

    -Check out the recent (and highly favorable) articles in Fortune and Money, calling this one of the
    best long-term hold, international stocks.

    -Latin America is no where near Asia!!!!!!!!!!!!!!!!!!

    -Hey, it's the "real thing".

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